[Graeme]

Valero to up refining capacity by 400,000 barrels per day$this->bbcode_second_pass_quote('', 'V')alero Energy Corp. plans to invest some $5 billion to expand refinery capacity by some 400,000 barrels per day over the next five years.

Although improvements will likely be made at all of the company's 18 refineries, Valero officials say the bulk of the work will occur at refineries in Texas, Aruba, Canada, Louisiana and California.

[frankthetank]

$this->bbcode_second_pass_quote('', 'N')EW YORK (MarketWatch) -- Valero Energy /quotes/comstock/13*!vlo/quotes/nls/vlo (VLO 16.58, +0.22, +1.35%) on Friday said it's shutting down its refinery in Delaware City, Del. in a move that will eliminate 550 jobs. "The decision to permanently close the Delaware City refinery was a very difficult one," said Valero Chairman and CEO Bill Klesse. "We have sought a buyer for the refinery, but feasible opportunities have not materialized. At this point, we have exhausted all viable options." In the fourth quarter, Valero expects to report a pre-tax charge of approximately $1.7 billion to $1.8 billion, or $2.00 to $2.15 a share after taxes, related primarily to asset impairment, employee severance and other shutdown costs.

[pitzel]

Woah. This is a refinery that's already been equipped to process some of the worst (and most prevalent) grades of crude on the market, while the rest of the industry is racing to get their refineries upgraded to take the higher-sulfur crudes.

And at 200k barrels per day, that's more than just a drop in the bucket.

Is the US economy really falling off a cliff that fast, such that a refinery like this is no longer feasible to operate?

[AirlinePilot]

$this->bbcode_second_pass_quote('pitzel', 'I')s the US economy really falling off a cliff that fast, such that a refinery like this is no longer feasible to operate?

[Revi]

Doesn't Valero process mostly Venezuelan crude?

Could that be part of the reason it's shutting down?

Are they shipping it to some other refinery in China maybe?

[frankthetank]

It could be losing money, losing supply, losing to foreign competition??? something else? Aren't they building refineries over in the middle east...

At some point we won't even be making our own gasoline and then we'll be really f%*%& when some of these overpopulated desert countries start burning everything at home/ or they stop excepting our toilet paper USD $$$...

[pup55]

$this->bbcode_second_pass_quote('', 'h')ttp://www.valero.com/InvestorRelations/Documents/Operating%20Highlights.pdf

[dorlomin]

Is this being permenantly decomissioned or mothballed.

Also was Valero not looking to offload refinaries last year?

[pup55]

Well, the announcement said that they were shutting the plant, and laying off the workers, and taking the writeoff, but there are a number of reasons that they might just mothball it and preserve what they need to preserve, and let it sit empty.

The biggest one of these is that in a lot of the country, and I do not know for sure whether Delaware is one of these areas, the air pollution permits and attainment stuff is considered sort of like property of the company and has some value in case they want to start it back up at some point....If they totally close down and give up the permits, they are likely to be issued to the neighbors.....They are laying off 550 but the press release below says that the crew is 690 so you can imagine that a skeleton maintenance crew could be kept on hand for a long time to preserve the plant in monklike fashion for however long it takes to restart it.

Once these things shut down for an extended time period though, they never do come up in quite the same way, because the one thing these things hate more than repeated hot-cold cycles is being down for some number of years.

The press release above is also in disagreement with Valero's documents on crude oil source.....

[Novus]

$this->bbcode_second_pass_quote('pitzel', '
')Is the US economy really falling off a cliff that fast, such that a refinery like this is no longer feasible to operate?