The risk of the closure of Caltex Australia's Sydney and Brisbane refineries became higher after the oil giant announced on Monday $852 million loss for 2011. Caltex is currently reviewing its operations which could result in the axing of 800 refinery jobs.

The company explained the large loss to refinery write-downs, operational disruption and the high Australian dollar. Caltex actually posted a net loss of $714 million which contrasts with the $317 million profit it made in 2010.

Despite the loss, Caltex - Australia's largest oil refiner - declared a final dividend of 28 cents per share, slightly down from 30 cents a year ago.

The bulk of Caltex's loss is the $1.5 billion write-down on the value of its plants. Prior to the release of its full-year report, Caltex warned that is conducting a six-month review of operations which could result in the shuttering of its two refineries.

"The recent deterioration in the performance of the refining business due to the challenging external environment, including the ongoing strength of the Australian dollar, lower refiner margins and increasing costs, is expected to be sustained for a prolonged period," Caltex said in a statement on Monday.

Caltex is 50 per cent owned by Chevron. Its two refineries in Australia are located in Kurnell in Sydney and Lytton in Brisbane.

The prospect of the closure of the two refineries and loss of 800 jobs would worsen the employment situation in Australia which actually logged a smaller 5.1 per cent joblessness rate in January. However, even prior to the release by the Australian Bureau of Statistics of the unemployment data in the middle of February, the second month of 2012 started with announcements of lay offs by major Australian companies such as BHP Billiton, ANZ Bank, Westpac, Holden, Manildra, Toyota, Reckitt-Benckiser and Thales.

Due to the growing trend of companies axing jobs, the Howe Inquiry into insecure work will hear on Tuesday the testimony of three Westpac employees who are among the 560 workers to be declared redundant in 2012. Besides the Westpac workers, whose jobs may end up offshore, other Australian workers from other sectors currently in insecure forms of work will testify before the probe body headed by former Deputy Prime Minister Brian Howe.

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