Viva Energy’s Geelong refinery finalises $250 million upgrade

Prime Minister Scott Morrison says a $250m upgrade of a Geelong refinery “will help keep our truckies, miners, defence force and farmers moving”.

Viva Energy chief executive Scott Wyatt at the Geelong refinery. Picture: Aaron Francis

The federal government has struck a $250m deal to upgrade a Geelong refinery, shoring up Australia’s fuel supply in the face of global uncertainty and supply chain difficulties.

Viva Energy will match the government’s $125m commitment to expand the refinery — one of only two in Australia — by the end of 2024.

Energy Minister Angus Taylor said the upgrade would also fast-track the rollout of ultra-low sulphur fuel from 2027 to 2024, saving $1bn in health costs through improved air quality.

Scott Morrison said Australia was not immune from disruptions to fuel supply caused by the pandemic, Russia’s invasion of Ukraine and trade restrictions, and that the government’s investment would maintain domestic production “even in the most challenging of times”.

“Oil refineries literally fuel a stronger economy and these investments will help keep our truckies, miners, defence force and farmers moving across Australia,” the Prime Minister said.

Mr Morrison said that combined with the government’s move to wipe 22 cents a litre from the fuel excise for six months, the Coalition had “put Australian motorists and businesses first”.

The average unleaded price in Melbourne prior to the last month’s budget was about $1.97 per litre. As of Monday, it had fallen to $1.62 a litre.

Unleaded petrol prices have dropped. Picture: David Caird

“We wanted to ensure every time Australians needed to fill up their car, that it would be cheaper for them and their family,” Mr Morrison said.

“In Melbourne, it’s great to see our fuel tax cut working, ensuring Victorians get to keep more of what they earn.”

The government is also providing another $125m to upgrade Australia’s other refinery in Brisbane.

The package was included in last year’s budget, but it took until now for the deal to be finalised with Viva Energy in Geelong, where 300 construction jobs will be created.

A fuel security payment was also made available to ensure the viability of the refineries, but both performed strongly enough to avoid receiving that support in the most recent three-month period.

“These grants are the next step in the Morrison government delivering on our commitment to support Australian domestic refiners to keep producing local fuel for Australian motorists,” Mr Taylor said.

“As well as enabling the production of better quality fuels, our landmark refinery production payments continue to provide taxpayers with lower than budgeted payments, with both refineries not needing any support in the second quarter.”