ST. LOUIS, Feb. 28 /PRNewswire/ -- Premcor announced today that it has
informed employees at its Hartford refinery that it will discontinue refining
operations in October 2002.
Thomas D. O'Malley, chairman, chief executive officer and president of
Premcor stated: "We have evaluated the feasibility of upgrading our Hartford
refinery to meet future low-sulfur gasoline and diesel fuel specifications and
have been unable to justify the significant investment that would be necessary
to remain operational." In order for Premcor to meet the deadline for the
introduction of low sulfur gasoline regulations, a significant capital
investment would have to begin in the fourth quarter of 2002.
"Employee safety and the environment will continue to be Premcor's focus
during the transition period prior to closing the refinery," said O'Malley.
Additionally, Premcor will continue to pursue all opportunities, including a
sale of the refinery, to mitigate the loss of jobs and refining capacity in
this area. However, there is no assurance that the company will be successful
in this regard.
Due to the planned discontinuation of operations, The Premcor Refining
Group Inc., an indirect wholly-owned subsidiary of Premcor Inc. and a direct
wholly-owned subsidiary of Premcor USA Inc., will take a pretax charge to
earnings of approximately $120 million, at least a portion of which will be
taken in the first quarter. This charge would include asset write-downs, and
accruals for employee severance, future environmental expense and other exit
costs. The actual expenditures for these items would occur over several years
following the shutdown.
Premcor operates two other refineries, the Port Arthur facility with a
capacity of 250,000 barrels per day (bpd) and the Lima Ohio refinery with a
capacity of 160,000 bpd. O'Malley stated that he expects both plants to be
able to meet the new fuel specifications in a timely manner.
Premcor Inc., through its principal operating subsidiaries, The Premcor
Refining Group Inc. and the Port Arthur Coker Company L.P., is one of the
largest independent petroleum refiners and marketers of unbranded
transportation fuels, heating oil, petrochemical feedstocks, petroleum coke
and other petroleum products in the United States. The company has an
aggregate 490,000 bpd of crude distillation capacity at its three refineries
located in Port Arthur, Texas (250,000 bpd), Lima, Ohio (170,000 bpd) and
Hartford, Illinois (70,000 bpd).
This press release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995, including the
company's current expectations with respect to future market conditions,
future operating results and the future performance of its refinery
operations. Words such as "expects," "intends," "plans," "projects,"
"believes," "estimates," "may," "will," "would," "should," "shall," and
similar expressions typically identify such forward-looking statements. Even
though Premcor believes the expectations reflected in such forward-looking
statements are based on reasonable assumptions, it can give no assurance that
its expectations will be attained. Factors that could cause actual results to
differ materially from expectations include, but are not limited to,
operational difficulties, varying market conditions, potential changes in
gasoline, crude oil, distillate and other commodity prices, government
regulations, and other factors contained from time to time in the reports
filed with the Securities and Exchange Commission by the company and its
subsidiaries, including Sabine River Holding Corp., Premcor USA Inc. and The
Premcor Refining Group Inc., including quarterly reports on Form 10-Q, reports
on Form 8-K, and annual reports on Form 10-K.
SOURCE Premcor Inc.
 back to top
Related links:
http://www.premcorinc.com
CONTACT:
Investors, Karen Davis, +1-314-854-1424, or
Media, Jim Joyce, +1-314-854-1511, both of Premcor Inc.
|
