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$2.3B rescue package saves hundreds of Qld refinery jobs

Ampol Lytton Refinery
Ampol Lytton Refinery

A struggling oil and gas operation postponed axing much of its workforce in southeast Queensland, after receiving its share in $2.3 billion of federal funding.

Ampol has decided not to immediately retrench hundreds of people who work for its Lytton Refinery near the Port of Brisbane.

The company formerly known as Caltex Australia ended a comprehensive review of its operations on a positive note, after receiving up to $108 million each year through the Federal Government’s Fuel Security Package. It will also be paid up to $125M to fast-track infrastructure upgrades for ultra-low sulphur petrol production plus a one-off, $40M short-term refining support payment. Viva Energy’s Geelong Refinery will receive the rest of the funding.

550+ jobs until 2027

This means 300 permanent staff and 250 contractors will theoretically keep their jobs for at least another six years with a potential three-year extension beyond this. However, the employer is still not ruling out the possibility of redeveloping the refinery into an Oil Import Terminal after taxpayer money runs out.

“Although Ampol intends to commit to refining until at least mid-2027, under the legislation, Ampol retains flexibility to withdraw from the package and pursue an earlier conversion to an import terminal in the case of persistently low refinery margins, or other materially adverse events including changes to the Fuel Security Services Payment by future governments,” the company said in a public statement.

1.8 cent saving

For now, Ampol promises to pass on what is left of the 1.8 cent per litre subsidy back to retail consumers.

“[The package] provides clarity and a path forward for our valued employees at Lytton, supporting the continued employment of 550 Australian manufacturing jobs and the indirect employment of hundreds more,” Ampol managing director and CEO Matt Halliday said in a public statement.

“The outcome will also allow Ampol to progress alternative future energy uses for this strategic site, preserving manufacturing skills that will be critical for success in the energy transition. We are [also] pleased that the governments have recognised the challenges faced by the local refining industry, which includes competition from large-scale international refineries and the impacts of COVID-19.”

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