Sunoco to sell or idle Phila., Marcus Hook refineries
The Philadelphia oil company said it has started the process of selling its two refineries in the region, but could close them in July 2012.
Sunoco to sell or idle Phila., Marcus Hook refineries
Mike Armstrong, Inquirer Columnist
Sunoco Inc. made it official Tuesday: It is getting out of refining.
The 126-year-old oil refiner and marketer said it has begun the process of selling its Marcus Hook and Philadelphia refineries. If it can't find a buyer, Sunoco intends to idle them in July 2012.
In a statement, Sunoco said it is also conducting a "strategic review" of the company and retained Credit Suisse Securities (USA) LLC for that process.
Without refineries, Sunoco will be a "pumps and pipelines" business, with 4,900 gas stations and convenience stores where it sells fuel, and a 31 percent interest in 7,600 miles of pipelines. The company recently took its coke manufacturing business public with the intent of spinning it off to shareholders.
Here's what CEO Lynn L. Elsenhans had to say:
We have made progress in increasing the efficiency of our refineries over the last several years, but given the unacceptable financial performance of these assets, it is clear that it is in the best interests of shareholders to exit this business and focus on our profitable retail and logistics businesses which have higher returns, growth potential, and provide steady, ratable cash flow.
The company said it will take a charge of between $1.9 billion and $2.2 billion in the third quarter in connection with the "impairment of the plant and equipment in the refineries."
When Elsenhans became CEO in 2008, Sunoco had five refineries. The company shut down its Eagle Point refinery in West Deptford in November 2009 and sold off refineries in Toledo, Ohio, and Tulsa, Okla.
The company also recently exited the chemicals business with sales of factories to several buyers.
Here's a link to the Sunoco press release.
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eng...they are getting out of refining because they sold off their oil drilling operations many years ago. that means that sunoco BUYS its crude for refining from other suppliers. as you know if you have been to a gas station in recent years, the price of crude spikes way too often for a company like Sunoco to make much profit refining— IcanTakeit- Hopefully there is a buyer. A lack of refining capacity has definitely affected the price of gas during outages at other locations.— MASTERNC
- Hopefully there is a buyer. A lack of refining capacity has definitely affected the price of gas during outages at other locations.— MASTERNC
- Just another lazy American Company more interested in profits than doing the hard work necessary to build a solid business. Of course it is easier to be a Pump & Retail outfit, but why should Sunoco be different that anyone else. The American Services economy moves on while manufacturing goes the way of the dinosaur.— MtnClmr
- Comment removed.
- "Terminal Facilities: The partnership’s ‘Terminal Facilities’ business segment had an operating income of $34.0 million – a quarterly record – up 21.4% year over year. This can be mainly attributed to increased contribution from the butane blending business acquired in July 2010 and higher tank rentals/fees at the Nederland crude oil terminal. These factors were partially negated by lower throughput at the partnership’s refined products and refinery terminals."
From Zacks dot com, online market research. So the press release is complete bunk.— citylumberjack - Comment removed.
- What happens to that labrynth of uglyness that produced all that gas?
Is Sunoco responsible for the decontamination and returning the land to its natural state?— joe smith - Sunoco would rather sell you a big bag of chips and an even bigger soda ("higher returns"), while you're buying gas at $6/gal.!!— dacoru
- Big Oil, Corporate America, Wall Street and the Republicans...
One BIG Happy Family:)— phillyfanboy - Comment removed.
- Comment removed.
- You should really get out of the slumblord business. — taxmanndumbeth
- What?? No stolen "stimulus" money for this employer? I guess they were not "green" enough for their employees to be deserving of wasteful & free government handouts...— kelprod2
Mike Armstrong blogs about Philadelphia corporations and business-related topics. Contact him at 215-854-2980.
Reach Mike at marmstrong@phillynews.com.
