Profits at Whitegate refinery reach €58m

Profits at Ireland’s only oil refinery reached €58 million in 2016, aided by improved prices and a boost to the value of the business, the latest figures show.

Turnover at Irving Oil Whitegate Refinery in Cork Harbour fell to $1.32 billion in 2016 from $1.7 billion the previous year, according to accounts for the Canadian-owned business. Costs also fell, boosting gross profit to $23.18 million at the end of the year.

The company recorded an impairment write back of $56.6 million, leaving it with operating profits of almost $80 million. After interest payments and other charges, it ended 2016 with a gain of $72.2 (€58.15m).

The balance sheet shows that Whitegate’s tangible assets rose to $75.2 million at the end of 2016, from $16.8 million 12 months earlier. The notes to the accounts state that the impairment reversal relates to an increase in the value of the refinery’s assets. The directors’ report says that crude oil prices improved through 2016, with a positive impact on the worth of its stocks.

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Irving Oil Whitegate states that during 2016 it expanded crude oil supply sources, helping to cut costs. The business also benefitted from low energy prices and a strong US dollar.

Net assets

Net assets at the end of 2016 were $136.7 million from a deficit of $470 million. Along with the improved value of the business, the company’s long-term debt fell to $136.5 million from $662.8 million. This was largely due to a reduction in the amount owed to other group companies to $6.7 million from $602 million.

A pension liability of $50 million transferred to the previous owner, Phillips 66 in September 2016, when Irving Oil bought Whitegate. This left the company with no obligations under its old salary-linked pension plan, which it closed to new employees in 2014.

Irving Oil is a family-owned group that operates Canada’s biggest refinery, in New Brunswick, that handles 320,000 barrels a day. The group supplies wholesale and retail customers in Canada and the US.