Valero shuts Delaware City coker, gasifier

By OGJ editors
HOUSTON, Sept. 9
-- Valero Energy Corp. is shutting down the coker and gasifier complex at the 210,000-b/cd refinery operated at Delaware City, Del., by its Premcor Refining Group Inc. subsidiary.

The move is the company’s third major curtailment of operations this year.

“Both the coker and the gasifier complex at the Delaware City refinery have been unprofitable, a situation resulting from the economic recession, declining demand for refined products, and poor coking margins due to a decreased price differential between heavy sour and light sweet crude oils,” the company said in a press release.

It also cited poor reliability and low operating rates of the gasifier complex, which it attributed to the facility’s design and low gas prices.

“Regulatory issues and potentially significant capital expenditures contributed to the decision to shut down the gasifer complex,” the company said.

Valero said the shutdown will reduce the Delaware City workforce by at least 150 employees and 100 contract workers.

It also said it expects to release more than 700 contract workers this month at its 235,000-b/d Aruba refinery, which it shut down in July and expects to remain idle “for an extended period.”

Because of its configuration as a heavy crude oil upgrading facility, the Aruba refinery was losing money because of narrowing spreads between the prices of heavy sour and light sweet crudes.

Valero also said the Aruba refinery suffered from “looming local tax burdens,” including a disputed tax on revenue and the expiration in December 2010 of a 20-year tax holiday.

In June the company shut down a coker and FCCU at its 315,000-b/d Corpus Christi, Tex., refinery. It also has trimmed coker utilization at other of its refineries.

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