Quantcast
StarBulletin.com

Chevron refinery in limbo


By

POSTED: Friday, May 15, 2009

Chevron Corp., the second-largest refiner in the West, is considering shutting its Hawaii refinery and converting it into a terminal.

The plant is the smaller of two refineries in Hawaii, which derives almost 90 percent of its energy from petroleum, according to the U.S. Energy Information Administration.

More than 75 percent of the state's electricity comes from petroleum-fired plants.

“;There are structural changes in the global refining sector,”; Chevron spokesman Al Chee said.

Those changes, which include an increase in refining capacity and more stringent fuel specifications, are forcing the company to study options for the refinery, he said.

Chevron has informed the plant's employees that it has a team evaluating long-term options for the 54,000-barrel-a-day refinery, according to Chee.

The other refinery in Hawaii, owned by Tesoro Corp., can process 94,000 barrels a day.

“;Hawaii's significantly dependent on petroleum, more than any other state,”; said Ted Peck, state energy administrator. “;We know that Chevron is committed to being a part of Hawaii's energy future.”;

Refiners in Asia will add 1.66 million barrels a day of capacity in 2009, or about 6 percent of the region's total, Ibnu Bramono and Alexis Aik of Facts Global Energy, a Singaporean-based consultant, said in a report on March 26. They said demand in the region might fall by 414,000 barrels a day.

Reliance Industries Ltd., India's most valuable company, will contribute the most to that capacity addition through a new, $6 billion plant that could increase global output of both gasoline and diesel by about 1 percent, according to Sanford C. Bernstein & Co.