Total makeover for loss-making French refinery
19 Mar 2010
Paris – Total plans to shut down its refining operations in Dunkirk, northern France, which will be ’repurposed’ with the installation of new operations support and petroleum logistics activities as well as the joint implementation of an LNG terminal project with EDF at the site.
The plan, which envisages no redundancies among the 370 employees at the Flandres refinery, is in response to a collapse in petroleum product demand in France, Europe and the US
According to Total, the refinery reported a loss of more than €130 million in 2009. Production was halted in September 2009 and, it said, given the poor outlook, resuming refining operations at the site is no longer considered viable and so will be gradually dismantled in a project that could last until 2013.
The refinery site will instead be used an industrial and technical facility engaged in three new activities that, said Total, “will leverage the industry-specific expertise of employees.” A total of 240 jobs will be maintained at the site, equivalent to two-thirds of the current workforce.
A refining operations support centre employing 180 people is to provide other Total refineries with technical support for routine operations and assistance with preparing, defining and organising major maintenance and revamping projects. The centre’s’s teams will also be responsible for static equipment inspection.
A refining training centre employing 25 people that will train group employees in the technical competencies required for refining, while a logistics depot employing 15 people, utilising the refinery’s tank farm. There will also be administrative positions for a further 20 people involved in site management.
Biofuel cluster
Total is also considering the possibility of maintaining the existing production unit for ethyl tertiary butyl ether, which is used in biofuels, at the Dunkirk site. ETBE . In addition, it will offer the site to its BioTfueL project partners for a second-generation biofuel pilot unit. This cluster would provide jobs for around 30 people.
Total and EDF, meanwhile, signed an agreement whereby Total reserves regasification capacity in the planned Dunkirk LNG terminal being developed by Dunkirk LNG, an EDF subsidiary in which it will acquire an interest.
With regasification capacity of between 10 billion and 13 billion cubic meters per year, the Dunkirk terminal would be able to meet more than 20% of French natural gas demand, which is equivalent to over 150% of the Flandres refinery’s energy production capacity. Dunkirk LNG will make the final investment decision by summer 2010, with a view to commissioning in 2014. The project remains subject to the necessary regulatory approvals, successful marketing and construction calls for tenders.
Up to 1,200 people will work on the project during the construction phase. Terminal operation will create at least 50 direct jobs, along with an estimated 150 indirect jobs. The partners would lend their expertise and staff during the construction and operating phases. Flandres refinery employees are to be given priority for the direct jobs created.
The 370 people concerned by the refinery shutdown will be offered three options.
1) They can stay in Dunkirk to:
• Work at the repurposed facility (240 people), in:
- The refining operations support centre (180 people).
- The training centre (25 people).
- The depot (15 people).
- Administration (20 people).
• Transfer to the LNG terminal project (50 people).
2) They can transfer to another Total facility in France to:
• Work in other Total refineries (80 people).
• Work in other Total units (30 people).
3) Take early retirement (20 people).
