Business World

Monday 18 December 2017

Buffet buys back into Whitegate owner

Warren Buffett
Warren Buffett
Peter Flanagan

Peter Flanagan

Warren Buffett has bought back into the company that owns the Whitegate refinery in Cork. Buffet's Berkshire Hathaway has taken a 10pc stake in the US refiner.

The 57.98 million-share stake was revealed in a Friday night filing with the US Securities and Exchange Commission. Phillips 66 shares closed on Friday at $77.23.

Berkshire once held a large stake in the Houston-based company, but shed nearly two-thirds of it in February 2014 when it swapped $1.35bn of shares for a chemicals business that it folded into its Lubrizol unit.

Crude oil prices have since fallen by more than half, though Phillips 66's share price has dropped by less than 1pc.

A Phillips 66 spokesman said the Houston-based company does not comment on specific shareholders. Berkshire may have begun rebuilding its Phillips 66 stake in the second quarter, when it bought $3.09bn of equities overall.

Last year Phillips 66 pulled the sale of Ireland's only oil refinery at Whitegate in Cork as attempts to find a buyer failed.

European refineries have struggled financially because of overcapacity. US refineries have a significant cost advantage due to cheaper natural gas prices.

In 2013, Phillips 66 refining chief Larry Ziemba described Whitegate as "small, not sophisticated, and can't really compete in Europe".

The Whitegate refinery has operated in east Cork for 56 years. Whitegate was sold by the State in 2001, along with a crude and products terminal in Bantry Bay, to US oil firm Tosco, which Phillips then bought.

Whitegate supplies around one third of Ireland's oil and is of significant strategic importance. (Additional reporting by Reuters)

Irish Independent

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