Exxon Mobil Corp. (XOM), the world’s biggest energy company by market value, will invest $1 billion to increase diesel production at its Antwerp refinery .
The company will add a delayed coker unit at the 320,000 barrel-a-day refinery in Belgium that will convert high-sulfur oil to diesel for use in trucks and ships, the Irving, Texas-based company said in a statement today. Exxon has spent $2 billion in the past decade on expansions in the refinery including a 130 megawatt power plant and hydrotreater unit that reduces sulfur from fuels, the company said.
“The investment addresses an industry shortfall in capability to convert fuel oil to products such as diesel,” Exxon said in the statement. The expansion “is the first of several being evaluated to further strengthen strategic refineries in Europe to more successfully face the challenging industry environment.”
Exxon’s announcement comes after Total SA (FP), the biggest refiner in western Europe, reported a 10 percent decline in profit in the quarter ended March 31 on smaller crude-processing margins caused by overcapacity. European refinery margins shrank to $6.60 per metric ton of crude processed in the three months from $26.90 a year earlier, Total said in April, citing its European Refining Margin Indicator.
Exxon’s shares have increased 0.2 percent this year, compared with the 6.8 percent gain in the S&P 500 Index (SPX) and a 2.3 percent advance in the Dow Jones Industrial Average. The stock gained 0.7 percent to $101.36 in New York yesterday.
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