01 August 2013 11:06 [Source: ICIS news]
LONDON (ICIS)--Truck drivers are blockading Eni’s refinery site in Gela, Sicily, on job loss fears over the potential standstill of the site’s polyethylene (PE) plant operated by the Italian oil and gas giant’s chemical subsidiary Versalis, according to local press reports on Thursday.
Versalis was not immediately available for comment.
The PE plant at the site has a capacity of around 150,000 tonnes/year of low density polyethylene (LDPE).
Italian newspaper Corriere della Sera said strikers had called for a week of strike action, which began on Wednesday 31 July.
Earlier in July, Eni had announced a project for the renovation and recovery of the Gela refinery.
The aim of the new project is “to create an economically sound refinery capable of meeting the challenges of a competitive and constantly evolving market,” the company said on its website.
The refinery would also be redesigned to be more environmentally friendly and respectful of the local area.
“The fall in demand for oil products has created excess capacity of approximately 100m tonnes/year, equivalent to 1.5 times the entire annual consumption in Italy. This has resulted in a change in refinery utilisation rates from 95% in 2005-2008 to the current 70% and a simultaneous fall in refining margins, causing significant losses for the industry,” Eni said on 9 July.
“Since 2009, the refining business in Gela has accumulated heavy losses, amounting to approximately a third of the losses of Eni's entire refining system. The renovation and recovery project, for which an investment of about €700m is expected, aims to restore the site's economic sustainability by overcoming its structural weaknesses,” it added.
Eni also said when fully operational in 2017, the Gela refinery will be able to “generate profits through products more suited to market requirements (maximised production of diesel and interrupted production of gasoline and polyethylene)”.
Earlier on Thursday, Eni said Versalis’s adjusted net loss widened to €78m ($104m) in the second quarter of this year, from a loss of €24m in the same period in 2012, amid weak demand and poorer sales.
Versalis’s sales of petrochemical products fell by 4.88% year on year to €1.52bn in the second quarter of this year, Eni added.
Versalis posted an adjusted operating loss of €82m in the second quarter of this year, widening from the €25m loss in the same period a year earlier, “reflecting lower marketed volumes due to weak commodity demand impacted by the current economic downturn as well as declining benchmark cracking margins,” it said.
On a group level, Eni’s net profit rose by 21.1% year on year to €275m in the second quarter of this year.
($1 = €0.75)
Additional reporting by Nurluqman Suratman
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