The Refinery capacity of Oil & Gas industry in United Kingdom attained a value of 1,242.85 mbd in 2020
The indicator recorded a historical decline (CAGR) of 1.44% between 2017 to 2020, and is expected to decline by ...
GlobalData projects the indicator to decline ...
Refinery capacity of Oil & Gas industry in United Kingdom declined in 2020
Crude distillation unit capacity in the country decreased in 2020 from that of 2015 at a negative low-single digit AAGR. It is expected to remain same from 2020 to 2025.
Coking unit capacity, Catalytic Cracker unit capacity, and Hydrocracking unit capacity in the country remains unchanged from 2015.
Downstream activities are highly capital-intensive. Setting up a refinery typically requires billion dollar investment, due to the size and the technology of these facilities. Refineries also require large economies of scale, while they have high operating costs. In the UK, daily oil consumption has been several times higher than the daily refinery capacity in the market in recent years, based on OPEC’s (2019) estimates. This overcapacity means that there is limited room for new entrants in this part of the market.
The oil and gas market volume is defined as the total consumption (barrels of oil equivalent) of refined petroleum products and natural gas by end-users in each country. The value of the oil segment reflects the total volume of refined petroleum products, including refinery consumption and losses, multiplied by the hub price of crude oil. The value of the gas segment is calculated as the total volume of natural gas consumed multiplied by the price of natural gas (Henry Hub spot price). The values represent the total revenues available to exploration and production companies from sales of crude oil and natural gas. All market data and forecasts are represented in nominal terms (i.e. without adjustment for inflation) and all currency conversions used in the creation of this report have been calculated using constant 2020 annual average exchange rates
Backwards integration is uncommon since extracting and refining oil and/or gas requires a vast amount of capital invested in heavy duty equipment which is outside of the reach of most buyers. Some very large-sized buyers for whom producing their own output of oil or gas may be beneficial to their core business might be an exception to this, such as Delta Airlines, for example, which has established its own oil refinery to reduce fuel costs. The largest chemical companies such as BASF, Ineos and Dow Chemical are also backward-integrated to petroleum refining and gas processing activities, as their core operations overlap with those of the petrochemical industry. Ultimately though, the likelihood of backwards integration is slim at best.
The refining capacity is the total design/nameplate capacity of the refinery and is the sum of the crude distillation unit (CDU) and condensate splitter (if any) in the refinery.
United Kingdom
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Saudi Arabia
United Arab Emirates
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France
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