Division 22Petroleum refining

### Division 22—Petroleum refining > Note: Condensate, eligible petroleum feedstocks, stabilised crude petroleum oil and unleaded petrol are explained in Part 2. 322 (1) Petroleum refining is the chemical and physical transformation of stabilised crude petroleum oil, which may be supplemented with one or more of condensate, tallow, vegetable oil, eligible petroleum feedstocks or other petroleum feedstocks, to produce a range of refined petroleum products through the following processes: (a) the distillation of stabilised crude petroleum oil, condensate, tallow, vegetable oil and other petroleum feedstocks; (b) the adjustment of the molecular weight and structure of hydrocarbons (such as that which occurs through catalytic or hydro‑cracking, steam or catalytic reforming, polymerisation, isomerisation or alkylation); (c) the blending of products from distillation and adjustment of molecular weight and structure to produce Australian and international standard diesel, jet fuel and unleaded petrol; (d) the production of 2 or more of the following refinery products saleable in Australian or international markets: (i) hydrogen; (ii) ethane; (iii) propane; (iv) refinery grade propylene; (v) polymer grade propylene; (vi) liquefied petroleum gas; (vii) butane; (viii) naphtha; (ix) aviation gasoline; (x) before oxygenate blend; (xi) kerosene; (xii) heating oil; (xiii) solvents; (xiv) lubricant base stocks; (xv) leaded petrol; (xvi) waxes; (xvii) bitumen. (2) Subject to subclause (3), the activity of petroleum refining will only take place in the financial year to which the application relates if both of the following apply: (a) each of the processes mentioned in paragraphs (1)(a) to (d) are conducted within the financial year to which the application relates for the facility; (b) the combined volume of diesel, jet fuel, unleaded petrol, lubricant base stocks and bitumen at 15 °C and 1 atmosphere produced from stabilised crude petroleum oil, condensate, tallow, vegetable oil and eligible petroleum feedstocks is: (i) for a facility that does not meet the criteria in subclause 705(1) or (2)—at least 75% of the total kilolitres of stabilised crude petroleum oil, condensate, tallow, vegetable oil and eligible petroleum feedstocks used within the previous financial year for the facility; or (ii) for a facility that does meet the criteria specified in subclause 705(1) or (2)—is likely to be at least 75% of the total kilolitres of stabilised crude petroleum oil, condensate, tallow, vegetable oil and eligible petroleum feedstocks likely to be used within the financial year to which the application relates for the facility. (3) The processes mentioned in paragraphs (1)(a) to (d) are not required to be conducted for every product mentioned in paragraphs (1)(c) and (d) for the activity of petroleum refining to occur in the application year. (4) Petroleum refining is specified as an emissions‑intensive trade‑exposed activity. (5) Petroleum refining is a highly emissions‑intensive activity. > Note: See Part 4. (6) Subject to subclause (7), the basis for the issue of free carbon units for petroleum refining is by a kilolitre of: (a) stabilised crude petroleum oil at 15 °C and 1 atmosphere; and (b) condensate at 15 °C and 1 atmosphere; and (c) tallow at 15 °C and 1 atmosphere; and (d) vegetable oil at 15 °C and 1 atmosphere; and (e) eligible petroleum feedstocks at 15 °C and 1 atmosphere. (7) A substance mentioned in paragraphs (6)(a) to (e) may be used as the basis for working out the issue of free carbon units for subclause (6) if the substance is, or is to be, refined: (a) by one or both of the processes mentioned in paragraphs (1)(a) and (b); and (b) into either of the following: (i) one or more petroleum products mentioned in paragraphs (1)(c) and (d); (ii) other by‑products which result from carrying on the emissions‑intensive trade‑exposed activity; and (c) in the financial year: (i) that applies, for the purpose of subclause 907(7), to the application made under clause 701; and (ii) in which the combined volume of diesel, jet fuel, unleaded petrol, lubricant base stocks and bitumen, at 15 °C and 1 atmosphere, produced from substances mentioned in paragraphs (6)(a) to (e) is: (A) for new or expected additional production—likely to be at least 75% of the total kilolitres of those substances likely to be used in the financial year to which the application relates; or (B) for production that is not new or expected additional production—at least 75% of the total kilolitres of those substances used in the previous financial year.