MOSCOW (MRC) -- Total, Europe’s biggest refiner, plans to adapt its French processing capacity as fuel demand drops, reported Hydrocarbonprocessing with reference to the company's chief executive officer.
"Refining has to be adapted to demand and demand is dropping," CEO Christophe de Margerie said at a meeting of the French employers’ group Medef outside Paris. "When demand drops, producers have to deal with it."
Total has borne the brunt of lower refining margins and a slump in consumption in Europe, where it operates eight plants. In its home market of France, it has joined LyondellBasell and Petroplus in halting surplus capacity, and peers elsewhere in the region have followed suit.
Total doesn't plan to pull out of refining altogether, de Margerie said.
While he said there is no "urgency" in Total’s plans for French refining, he declined to give details on how and when capacity will be cut in France.
The company has already shut a refinery at Dunkirk and a steam cracker at Carling in eastern France to lower capacity. Refiners in France lost EUR00 million (USD951 million) in 2013 as margins shrank and the country imported more than half the diesel it used, the Union Francaise des Industries Petrolieres has said.
Total has a target to reduce its European refining and petrochemicals business by 20% from 2012 to 2017. The Courbevoie-based company faced opposition from workers and the state over the closing of the Dunkirk plant, and it promised the government in 2010 it wouldn’t shut another site for five years.
As MRC wrote before, last year, Total intends to invest EUR160m before 2016 to adapt its petrochemical platform in Carling, in the Lorraine region of eastern France, and to restore its competitiveness. The Carling plant, which makes petrochemicals such as ethylene and propylene at the site near the German border, employs 350 Total workers as well as sub-contractors. These chemicals are used to make plastics.
Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC