Cosmo Oil to close Sakaide refinery in western Japan by 2013

Cosmo Oil Co. said that it will close its refinery in Sakaide, Kagawa Prefecture, western Japan, in July 2013 to address falling oil demand in the country. The closure is estimated to cut costs by 10 billion yen (US$127.5 million) annually and reduce Cosmo Oil’s total refining capacity by about 20% to 500,000 barrels per day.
After the closure, the company’s domestic refinery operations will be concentrated in three bases: Ichihara, in the eastern prefecture of Chiba; Yokkaichi, in the western prefecture of Mie; and, Sakai in Osaka Prefecture, also in western Japan.
Cosmo Oil will raise capacity utilization rates at these three refineries, after the closure of Sakaide, which currently processes 140,000 barrels of crude oil a day.
After the shutdown, Cosmo Oil plans to use the site for the Sakaide refinery as a logistics base. It may also use it for solar power generation, officials said.
Some 400 workers at the Sakaide refinery will be transferred to the other bases.
Cosmo Oil President Keizo Morikawa said the decision was unavoidable in light of Japan’s changing demographics.