Exxon and AGIP to Integrate Two Italian Refineries

abarrelfullabarrelfull wrote on 14 Jul 2014 10:55

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Oct. 20th 1999

Esso Italiana, an Exxon Corporation (NYSE: XON) affiliate, today announced an agreement to integrate and
rationalize its refinery in Augusta (Sicily) with the adjacent AGIP Petroli refinery at Priolo.

When complete, this initiative will create a highly efficient refining complex, combining a crude processing capacity of approximately 240,000 barrels per day with large-scale chemicals, lubricants and power generating
capacity. The complex will rank among the most efficient refineries in Western Europe.

The agreement, which is subject to review by the Italian Antitrust Authority, envisions the formation of a joint company (50/50) between AGIP Petroli and Esso Italiana. Under the terms of the agreement, the refinery
will be operated in conjunction with chemicals, lubes and electricity production facilities which will retain their current ownership.

The investments required to achieve this integration will amount to approximately US$110 million. Additional investments are currently under evaluation to meet future European fuel product specifications.

The integration and related interconnections of these two existing sites are expected to be completed within two years. During this period the production cycle of the two sites will remain substantially unchanged.

Esso Italiana and AGIP Petroli further announced the signing of a non-binding memorandum of understanding with Erg Petroli to sell to Erg the existing Priolo motor gasoline production facilities after Esso and AGIP have
completed the refinery integration process. This sale will be finalized after resolution of remaining contractual issues, completion of due diligence and approval by Italian antitrust authorities.

Exxon affiliates have operated in Italy since 1891. In addition to Augusta, Esso Italiana is the operator and 75 percent owner of the 250,000 barrel per day Trecate refinery near Milan and has extensive retail and wholesale fuel, lube and chemical sales operations.

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