It follows a loss in earnings at the refinery of $82 million for the third quarter and $141 million for the year so far.

“Given the challenging operating conditions experienced during 2020, Ampol will commence a comprehensive review of the Lytton refinery and its related supply chains to determine the best operating model over the medium term,” the company said in the statement to the ASX.

“The review will consider all options for the facility’s operations and the connected supply chains and markets it serves. These options include closure and the permanent transition to an import model, the continuation of existing refining operations and the alternate models of operation, including the necessary investments required to execute each of the options.”

It has been as tough year for refiners, in part because the pandemic has slashed demand for oil.

Ampol suspended operations at Lytton earlier this year to bring forward maintenance, which is a significant factor in the earnings loss.

Those losses also included the higher costs in the supply chain.

Ampol managing director Matt Halliday said the review would consider all relevant strategic, economic and operational factors, including the recent measures announced by the Federal Government to support refining and bolster fuel security.

“Global conditions triggered by COVID-19 have put significant pressure on refining, as evidenced by our performance in the first half and the significant losses we announced today,” he said.

“We must continue to deliver strong returns on capital and this review will allow us to be proactive in determining the best course of action to protect our balance sheet, improve earnings certainty and maximise shareholder value from our integrated supply chain”

Three refineries have closed in Australia in the past decade, and Lytton is one of only four left. Viva Energy is considering the closure of its Geelong refinery later this year.