Equinor shedding Danish refining assets

June 10, 2021
Equinor ASA has inked a deal for the sale of subsidiary Equinor Refining Denmark AS—including its 107,000-b/d refinery at Kalundborg, Denmark—to UK-based Klesch Group.

Equinor ASA has inked a deal for the sale of subsidiary Equinor Refining Denmark AS (ERD)—including the ERD-operated 107,000-b/d refinery at Kalundborg, in northwest Zealand, Denmark—to UK-based Klesch Group, owner of Raffinerie Heide GMBH’s 4.5-million tonne/year (tpy) refinery at Hemmingstedt, Schleswig-Holstein, Germany.

Alongside the Kalundborg refinery and associated terminal in Zealand, the proposed sale—which hinges on approval by Danish authorities—includes ERD’s Hedehusene terminal near Copenhagen, and associated infrastructure and industrial property, Equinor and Klesch Group said June 10.

Further commercial details on the planned transaction, including its value and timeframe for conclusion, will remain confidential, the companies said.

Upon completing the transaction, Klesch Group said it will retain existing ERD employees with equitable employment terms compared with those provided by Equinor.

Equinor said sale of the Danish refining assets supports its broader strategy of focusing on core areas, which in refining center around subsidiary Equinor Refining Norway AS’s 266,000-b/d refinery in Mongstad, Norway.

The Mongstad plant specifically will play a major role in Equinor’s development of new value chains, including hydrogen, biofuel, and ammonia, the operator said.

Given the Kalundborg refinery’s proximity to the Heide refinery, A. Gary Klesch, chairman of Klesch Group, said he expects its acquisition will provide ample opportunity for synergies between the two, particularly with relation to implementing the firm’s decarbonization strategy.

Equipped to process a broad range of crudes and condensates from Scandinavia and Africa, the Kalundborg refinery can produce up to 5.5 million tpy of finished products, including low-sulfur, low-benzene gasoline, low-sulfur diesel, propane, heating oil, and fuel oil, mainly for markets in the Baltic Sea area.