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Exxon’s Expanded UK Refinery to Supply First Diesel in Early 2025

While other international majors are closing down refineries or converting them to biofuel production, ExxonMobil is expanding its UK site and will start delivering diesel from the expanded Fawley refinery in early 2025.

ExxonMobil is investing $1 billion (£800 million) in the main construction phase of a new low-sulfur diesel facility at the Fawley refinery, which is set to help meet Britain’s energy needs today and build the foundations for lower-carbon fuels in the future with the addition of a new hydrogen plant, the U.S. supermajor says.

The diesel-producing unit could be reconfigured later to make jet fuel or sustainable aviation fuel from vegetable oils, according to the plant’s manager Nick Bone.        

“There is a lot of molecular magic we can do with this kit,” Bone told Bloomberg.

Exxon says that increasing low-sulfur diesel production at Fawley by 40% should reduce imports into Britain by a quarter.

Exxon’s investment to boost diesel production in Europe is a rare occurrence in the European refining industry nowadays.

For example, the Grangemouth refinery in Scotland could cease refining operations by 2025 under a plan from the owner Petroineos, a joint venture between PetroChina and UK’s Ineos, to convert it into a fuel import hub.

Meanwhile, oil majors have recently announced upcoming closures of European oil refineries that would be converted into biofuels-making facilities. The latest include Eni’s refinery in Livorno, Italy, and Shell’s oil refinery at the Wesseling site in Germany which will be converted into a production unit for base oils.

Europe and China are at higher risk of refinery shutdowns because of worsened economics, Wood Mackenzie has said in a recent report which found that more than 20% of the total global refining capacity is at some risk of closure as refining margins are set to weaken alongside demand, while carbon taxes could also burden many refiners.  

European refineries will see their net cash margins decline from 2030 due to the unwinding of free allowances for carbon emissions, while transport fuel demand in developed countries is expected to begin to decline from next year onwards, according to WoodMac’s analysis.  


By Tsvetana Paraskova for Oilprice.com

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