13 March 2012 22:50 [Source: ICIS news]
SAN DIEGO, California (ICIS)--Maintaining positive returns on capital investment is a major challenge for the refining industry as a result of high fixed costs and other factors, the chief executive of US refiner Tesoro said on Tuesday.
“That’s no easy task with a business with high fixed costs, enormous capital intensity and the need to run at very high utilisation rates,” said Gregory Goff, the chief executive of Tesoro.
Goff spoke during the annual meeting of the American Fuel and Petrochemical Manufacturers (AFPM) in San Diego. The meeting ends on Tuesday.
He said the refining sector had about a 4.8% return on capital investment.
However, it will be hard for refiners to maintain or exceed those returns as long as the government puts unfair mandates on the industry, Goff said.
“Rational involvement on the part of the government in our industry is something we should expect, embrace and welcome,” he said. “It’s the irrational variety …that contributes to an environment that makes fuels manufacturing challenging.”
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|