22 Sep 2014

Refinery's gross margin above floor

6:38 pm on 22 September 2014

Refining New Zealand's gross margin for July and August rose to $US6.75 a barrel, which the company attributes to its excellent operational performance.

That is a $US7.30 increase over Singapore complex margins and up from just $US3.72 a barrel in May and June.

It has meant the refinery has repaid $NZ13.5 million of support payments to its major shareholders and customers.

The refinery has an agreement with the four major petrol companies who pay top-up payments when the margins fall below a specified floor and who the refinery pays when margins exceed a specified cap.

It said measures taken to improve margins added about 90 cents a barrel in July and August, above the planned 66 cents.

Forsyth Barr analyst Andrew Harvey-Green said he expected the company's margin will be below the floor for the 2014 calendar year.

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