Statoil is considering shutting the oil refinery at Mongstad following huge annual losses, reports suggest .

The oil refinery’s deficits have cost Statoil 9.2 billion kroner so far, and the company expects them to rise further. 

“It’s an extremely serious situation at Mongstad,” Statoil press spokesperson Morten Eek tells Aftenbladet.

Crisis meeting

The company has already reduced staffing by 200 FTEs (full-time equivalents). Statoil has now asked for a crisis meeting with Labour’s (Ap) Trade and Industry Minister Trond Giske, according to an email Teknisk Ukeblad has obtained access to.

In the email, Statoil underlines all possibilities concerning the refinery’s future must be considered should the company not manage to achieve profitability there.

“It’s a complex situation that is to do with challenging market conditions with low margins, relatively high cost-levels, and unfavourable conditions for the refining industry in recent years,” writes Statoil.

Results for the Mongstad refinery were minus 4.5 billion and minus 3.5 billion in 2009 and 2010, respectively.

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