Japan refinery to close as demand shrinks

JX Holdings Inc., may close down its Negishi Refinery in Isogo Ward, Yokohama, as demand for gasoline in Japan is expected to decline 16 percent in the next five years, Yomiuri Shimbun said.

The refinery produces 270,000 barrels per day, about half of what JX Holdings plans to trim from its current production of 1.8 million barrels a day, produced by eight refineries. By the end of the month, the firm expects to cut production to 1.4 million barrels per day, sources told the newspaper.

Demand is in decline due to Japan's aging population, a shrinking birth rate and rising concern about environmental issues.

In Japan, refining capacity peaked 30 years ago at about 6 million barrels per day. In March, refining capacity was down 20 percent from the 1980's peak with refining capacity at 4.8 million barrels per day.

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