UK returns to fuel dependency for first time since 1984, must import fuel to meet basic needs-UK Telegraph

3/27/14, "Fuel imports take UK back to dark days of 1984 as refineries close," UK Telegraph, Andrew Critchlow

"Britain now dependent on imports of oil products such as diesel for first time in 30 years."

"Britain has become a net importer of petroleum products such as diesel for the first time since 1984 amid the closure of refineries and a sharp drop in crude production from the North Sea, the latest Government figures show. 

"The closure of the Coryton refinery in July 2012 was a contributory factor towards lower production in 2013. Refinery production was also weakened by increasing competition from imports," said the Department of Energy & Climate Change (DECC) on Thursday. 

Coryton, which was sold by BP to Petroplus in 2006 for $1.4bn (£841m), once supplied between 10pc and 15pc of the UK's petroleum products. DECC has said that the country's remaining refineries are incapable of producing enough middle distillates such as gas diesel and aviation fuel to meet domestic demand. 

Downstream petroleum industries such as refineries and petrochemicals plants in the UK have suffered from high operating costs and steady declines in demand for conventional fuels. 

 
Last year Ineos threatened to close down the giant Grangemouth refinery and petrochemicals complex in Scotland after racking up losses in the region of £600m over the past four years. In December, the plant was reportedly losing about £10m a month due to the combination of high labour costs and dwindling feedstocks. 

The UK became a net importer of petroleum products including car lubricants and petrol by a margin of some 2m tonnes in 2013, according to DECC data, which also revealed a 0.7pc decline in the consumption of fuels for transport over the same period. 

"This is the first time the UK had been a net importer since 1984 when demand for petroleum products increased as a result of industrial action in the coal industry." said DECC. 

The figures also revealed that imports of crude oil met about 25pc of UK demand last year, which was unchanged from 2012 despite a fall in North Sea production throughout the year. 

"Crude oil import dependence has been on an increasing trend as the production from the UK Continental Shelf continues to decline," said DECC. 

"The decline in 2013 is a continuation of a long-term trend. Production was also affected by maintenance and unplanned outages at several oil and NGL fields in 2013, including the Buzzard field which is a key source of oil." 

Information collected for the Joint Oil Data Initiative showed that declines in North Sea output have carried through to this year. Production of crude oil fell by 5.8pc in February compared with the previous month, which had also posted declines. 

Last week George Osborne, the Chancellor, said new measures to boost oil drilling companies were necessary as the Office for Budget Responsibility downgraded its forecast for North Sea oil and gas tax receipts by a further £3bn in 2014/15.

The Government is also planning to adopt the findings of a comprehensive report on how to revive the offshore industry prepared by Sir Ian Wood."




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