BP announced that it intends to sell its Texas City, Texas and Carson, Calif. refineries as part of a plant to reposition its refining and marketing (R&M) business in the United States. BP also plans to sell its associated integrated marketing business in Southern California, Arizona and Nevada. Subject to regulatory and other approvals, BP plans to complete the sales by the end of 2012, thereby halving BP”s U.S. refining capacity.
BP plans to focus future downstream investment in the United States on further improving and upgrading its other R&M networks, including the Whiting, Indiana and Cherry Point, Washington refineries and its 50 percent interest in the Toledo, Ohio refinery. According to BP, these refineries have greater flexibility to refine a range of crude oils, including heavy grades, and on average are more diesel-capable than BP”s current portfolio.
BP intends to sell both the Texas City refinery and the Carson refinery with its marketing network as going concerns and expects significant market interest in the assets.
BP expects to raise at least $4.4 bill. through the sale and will use the funds, in part, to pay for last year”s Gulf of Mexico oil spill cleanup, according to a report by Bloomberg.
The Carson refinery, south of Los Angeles, has 265,000 barrels per day (bpd) refining capacity and supplies 25 percent of Los Angeles gasoline demand. The Texas City refinery has 475,000 bpd refining capacity, making it the the third biggest refinery in the United States, with gasoline manufacturing capability equivalent to approximately three percent of U.S. production. The refinery employs some 2,200 BP staff and, contractor numbers can vary between 2,000 and 4,000 each day.