As BP shuts down Bulwer refinery, a smaller but modern oil refinery is being planned for Queensland

As oil major BP ceased production at its 102,000 barrel-per-day (bpd) Bulwer Island refinery in Brisbane, Australia, Australian energy start-up Casper Energy and U.S. independent Eagle Ford Oil & Gas Corp. are in talks to build a new 43,000 bpd refinery in Queensland, Casper Energy General Manager Duncan Mackenzie said. Casper Energy is a privately owned company formed in May 2012.

The refinery, to be built in Gladstone, Queensland, would be the first new-build oil refinery in Australia in more than 50 years. Construction could start in two years, if all goes well, Mackenzie said.

The plan comes at a time when Australia continues to rationalize domestic refining capacity, primarily through the closures of non-competitive and obsolete refineries.

The timing is right to build a new refinery, with the recent closures of a BP refinery and a Caltex refinery, said Mackenzie. Its flagship product would be a low-sulfur gasoil that meets Euro 5 standards. The refinery will be designed to process indigenous light/sweet crude oil, as well as heavier imported crude oil.

“With the design of the refinery we will be able to source crude from a wide variety of suppliers,” Mackenzie said.

Meanwhile, BP is preparing to convert the Bulwer site into a jet fuel import terminal.

“The import jetty, aviation fuel tanks and associated pipelines remain operational to allow the site to transition to a jet fuel import terminal,” a BP spokeswoman said.

The company announced the closure of the refinery in April 2014. Caltex will supply all of BP’s requirements for diesel fuel and gasoline in South Queensland, while Asian refineries will supply its jet fuel requirements.