Jan. 31–Chevron said Wednesday that it would buy a refinery in Pasadena owned by Petrobras Americas, the U.S. subsidiary of Brazil’s state-owned oil company, for $350 million.
The acquisition by Chevron, which was first reported by Reuters, marks the oil major’s first refinery in Texas and a shift toward processing crude from West Texas.
Chevron, the second-largest energy company in the United States has amassed substantial holdings in the Permian and ranks among the biggest producers in the region. But the companies pumping huge amounts of crude in West Texas have been challenged by a lack of Gulf Coast refiners equipped to process the light grade of crude; most refineries on the Gulf are equipped for heavier grades, like the crude grades of Canada and Venezuela.
REVAMPING: Oil majors prepare refineries for more West Texas crude
The nation’s largest oil companies have moved ahead with major investments as of late to switch their refining strategies along the Gulf Coast in response. Exxon Mobile said this week that it has begun construction of an expansion of its refinery in Beaumont.
The Pasadena refinery has the capacity to process approximately 110,000 barrels of light crude oil per day, as well as pipeline connections to major product pipelines and productions. The 466-acre complex also has waterborne access to receive and ship crude oil and refining products as exports. The tank farm has a storage capacity of 5.1 million barrels of crude oil and refined products, as well as 143 acres of additional land.
“This expansion of our Gulf Coast refining system enables Chevron to process more domestic light crude, supply a portion of our retail market in Texas and Louisiana with Chevron-produced products, and realize synergies through coordination with our refinery in Pascagoula,” said Pierre Breber, executive vice president of Chevron Downstream & Chemicals in a statement.
Chevron also owns refineries in Mississippi, California and Utah.
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