Equinor (NYSE: EQNR) announced Thursday that it has entered into an agreement with the Klesch Group for the sale of its refining business in Denmark.
The agreement covers the Equinor Refining Denmark A/S (ERD) company and comprises the Kalundborg refinery and terminal in the northwest of Zealand, the Hedehusene terminal near Copenhagen, and associated infrastructure and industrial property, Equinor highlighted.
On completion of the transaction, including approval by Danish authorities, all ERD employees will be transferred to the Klesch Group with equitable employment terms as within Equinor, the company noted. Equinor, which did not disclose the value of the deal, said the transaction does not affect its ownership and/or operation of Danske Commodities, headquartered in Aarhus, Denmark.
“This transaction supports Equinor’s strategy to focus its portfolio around core areas,” Irene Rummelhoff, Equinor’s executive vice president for marketing, midstream, and processing, said in a company statement.
“Equinor will concentrate its refining position around Mongstad, Norway, where the company can leverage its integrated industrial cluster, expand the portfolio of low carbon energy products provided, and contribute to Equinor’s efforts in the energy transition,” the Equinor representative added.
Commenting on the deal, A. Gary Klesch, the chairman of the Klesch Group, said, “I am so pleased that we were able to reach an agreement today to purchase the Kalundborg refinery from Equinor”.
“The refinery is first class and so are its people. It was challenging during the covid pandemic to undertake this acquisition, but through the hard work of both my team and Equinor’s team, we were able to get there in the end,” he added.
“Given the proximity of our refinery in Germany, I’m sure there will be lots of opportunities for both refineries to work together; especially when it comes to deploying our decarbonization strategy,” Klesch continued.
The Kalundborg refinery was built in 1961 and was acquired by Equinor in 1986 before increasing capacity in 1995. The plant can process 107,000 barrels a day of crude oil and condensate for gasoline, diesel, propane, and heating oil and its annual production capacity is up to 5.5 million tons of oil products.
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