NZ Refining H1 profit falls, expcts lower full yr

WELLINGTON Aug 18 (Reuters) - New Zealand Refining Company Ltd NZR.NZ, the country's only oil refinery, posted a 2.8 percent fall in first half profit on Tuesday and said it expected to operate at a loss in the second half because of a planned shutdown.

The company made a net profit of NZ$52.5 million ($35.2 million) for the six months to June 30, compared with NZ$54 million last year.

The company said it would not pay a first half dividend because of the shutdown. Last year it paid an interim dividend of 15 cents per share.

Shares in the company, around 73 percent owned by BP (BP.L), Mobil Oil NZ (XOM.N), Caltex NZ (CVX.N), and Shell NZ (RDSa.L), last traded down five cents or 0.7 percent at NZ$6.85. The stock has risen around 17 percent so far this year compared with a gain of more than 13 percent for the benchmark top 50 index .NZ50.

Both Shell and ExxonMobil have been reviewing their downstream businesses, which might involve divestment of their stakes in the refining company.

In July NZ Refinery said it was unaware of any takeover interest in the company, after media speculation U.S. refiner Valero Energy Corp (VLO.N) was eyeing the company. [ID:nSYD467912] The company said it would operate at a loss in the second half of the year because of a planned four-week shutdown in September, which would result in the full year profit below the interim profit level.

The company said the refinery processed 18.6 million barrels of crude oil, with an average gross refining margin of US$6.60 a barrel.

NZ Refining supplies more than 70 percent of the country's refined fuels, and charges a processing fee for refining crude oils and feedstocks.

It said margins had come under pressure because of the high New Zealand dollar, reduced demand, a surplus of refining capacity around the world, and a change in the type of crudes it had been processing. ($1=NZ$1.49)