Category Archives: Chevron Refinery

Closing of California’s 4th largest oil refinery will cost thousands of jobs

Shutdown of Marathon’s Martinez Refinery Prompts Calls for ‘Just Transition’ for Oil Workers

KQED News, by Ted Goldberg, Aug 3, 2020
A view of the Marathon Petroleum Corp. refinery in Martinez. (Tesoro)

Elected officials, union leaders, industry representatives and environmentalists are expressing concern about the hundreds of workers set to lose their jobs at California’s fourth-largest refinery in the coming months.

That’s after Marathon Petroleum announced over the weekend that it plans a permanent halt to processing crude oil at its Martinez plant.

“The decommissioning of the Marathon refinery means the loss of thousands of good paying, California blue collar jobs at a time of great economic uncertainty,” said Robbie Hunter, president of the State Building and Construction Trades Council of California, which represents thousands of people who work at the plant in the course of a year.

Marathon executives told employees at its Contra Costa County and Gallup, New Mexico, refineries on Friday that it plans to cut workers.

“We will indefinitely idle these facilities with no plans to restart normal operations,” the company said on its website.

The company had idled both refineries in April after shelter-at-home orders drastically cut demand for gasoline and jet fuel. That meant processing units at the plants stopped making transportation fuels and other refined products. For months the refineries have been maintained in “standby” mode.

The Friday announcement means “most jobs at these refineries will no longer be necessary, and we expect to begin a phased reduction of staffing levels in October” the company said on its website.

Marathon employs 740 staff workers at its Martinez refinery, which has gone through several owners and name changes. It was formerly known as the Tesoro, Golden Eagle, Tosco Avon and Phillips Avon refinery. Marathon bought the facility in 2018.

In addition to the full-time employees, the refinery relies on between 250 and 2,500 contract workers depending on operational needs, according to Marathon representative Patricia Deutsche.

“There is also the ‘multiplier’ effect. They say for every one refinery job there are eight in the community that support that,” Deutsche said.

“This move is a big loss for our workforce and potentially the economy,” said Rep. Mark DeSaulnier, D-Concord, who represents Martinez and has been a longtime advocate for refinery safety.

DeSaulnier said that before the coronavirus pandemic and the oil industry downturn, he began bringing together labor unions, environmental groups and local governments to prepare for a shift to green energy in Contra Costa County.

“The transition needs to be as successful as possible for everyone and we cannot leave workers behind — they need to be guaranteed meaningful and comparable work,” DeSaulnier said in an emailed statement Sunday.

A spokesman for a leading trade group that represents the oil industry in California said he feels for the local economy that relies on the refinery, which can process about 160,000 barrels of crude per day.

“Obviously, this impacts a lot of people, families and the community and we are concerned for them,” said Kevin Slagle, a representative for the Western States Petroleum Association.

The refinery has seen its share of incidents. The worst in the last decade took place in February 2014, when the facility was run by Tesoro. Two workers were burned and 84,000 pounds of sulfuric acid were released. A month later sulfuric acid sprayed and burned two contract workers, leading to an investigation by the U.S Chemical Safety Board that raised concerns about the refinery’s safety culture.

Like the Bay Area’s other four refineries — Valero in Benicia, Chevron in Richmond, PBF Energy in Martinez and Phillips 66 in Rodeo — the facility has had to send gases to its flares scores of times over the years, many times to deal with malfunctions.

Local environmentalists who’ve been critical of the region’s oil industry say it’s time for the refinery, its dangers and pollution to go away, but the change should include a plan for workers.

“This is what an unplanned transition looks like,” said Greg Karras with Community Energy reSource.

It’s “the tip of the iceberg for why we need a planned, just transition to sustainable energy and a livable climate,” Karras said.

Some environmentalists and union advocates have used the term “just transition” to explain a fair way of getting fossil fuel industry workers and their surrounding communities, businesses and local governments to move into a green energy economy.

Hollin Kretzmann, an Oakland attorney with the Center for Biological Diversity, said the air quality benefits of a refinery shutting down are welcome but expressed concern about workers.

“Communities near this dangerous refinery can breathe a little easier now that operations have halted, but the state desperately needs a just transition plan that protects workers when oil companies toss their employees to the curb with little warning,” Kretzmann said.

Marathon says its Martinez refinery will be converted to an oil storage facility. The company says it’s considering turning the facility into a renewable diesel facility.

“The Marathon refinery’s (potential) conversion into a renewable diesel facility is a forecast of the future as the demand for fossil fuels declines over time, resulting in healthier air and reduced greenhouse gas emissions,” said Contra Costa County Supervisor John Gioia.

“We will see more future refinery closures as a result of continued decreasing consumption of fossil fuels under California’s policies transitioning our transportation system to zero emission,” said Gioia, who sits on the the Bay Area Air Quality Management District board and the California Air Resources Board.

“We need to immediately start addressing a just transition for these workers as more fossil fuel facilities close,” he said.

Marathon’s decision to end oil processing at its Martinez plant is the latest piece of evidence showing California’s oil industry suffering under a pandemic that’s led to severe drops in fuel demand.

San Ramon-based Chevron, one of the world’s largest oil companies, announced its worst quarter in decades on Friday. The company said it lost more than $8 billion during the three months ending June 30.

“All the oil majors have been clobbered by COVID,” said David Hackett, president of Stillwater Associates, a firm that specializes in analyzing the transportation fuels market.

Earlier this month, the California Resources Corporation, one of the state’s largest oil producers, filed for bankruptcy.

In May, the Newsom administration granted a request by another oil trade group, the California Independent Petroleum Association, to drop a proposal to add dozens of staff members to the agency that oversees oil and gas drilling that would have cost the industry $24 million. State regulators also agreed to postpone a deadline for oil and gas producers to pay fees and submit plans to manage thousands of idle oil wells.

In April, PBF Energy, the New Jersey-based company that bought Shell’s refinery in Martinez, sold two hydrogen plants at the facility for hundreds of millions of dollars — a move aimed at cutting costs and raising revenue to deal with fuel demand drops.

That same month, more than 1,000 contract electricians, pipefitters and other skilled workers were cut from Bay Area refineries.

KQED: Valero Benicia one of three Cal oil refineries shut down – gas prices up, Chevron flaring

Repost from KQED California Report

Valero Could Restart Troubled Benicia Refinery by Mid-May

By Ted Goldberg, Apr 15, 2019
The Valero refinery in Benicia. (Craig Miller/KQED)

Valero’s Benicia refinery, shut down since last month because of equipment malfunctions, could be back online by mid-May, Benicia city officials and state regulators say.

Although the company won’t provide a date that it plans to restart the Solano County facility, Benicia Fire Chief Josh Chadwick said Monday he estimates the refinery will be back online in the next three to four weeks.

Chadwick said a Solano County hazardous materials specialist assigned to Valero provided him with the estimated timetable. County officials did make the specialist available for comment.

The California Energy Commission said Monday that the Benicia refinery is one of three California crude oil processing facilities that the agency expects to be restarted over the next several weeks. Shutdowns at the refineries — including two in the Los Angeles area — have helped drive up the cost of gasoline statewide.

Valero powered down its Benicia facility on March 24 after failing to resolve malfunctions that led to the release of soot-laden smoke.

The incident prompted Solano County to issue a health advisory for people with respiratory issues to stay indoors.

A Valero representative said the company will not disclose its restart date.

“I know we shared information about the status of the refinery on March 24, but beyond that, it is Valero’s policy to not comment on operations or possible outages/restarts at its facilities beyond what is publicly reported,” said Lillian Riojas, a company spokeswoman.

The California Energy Commission has been in touch with Valero but does not release certain data about its operations due to regulatory restrictions, according to agency spokeswoman Sandy Louey.

But Louey said refinery issues that have played a part in recent gas price increases — including the Valero shutdown — would be coming to an end in the coming weeks.

“The Energy Commission can say that the three large refinery maintenance issues are scheduled to be resolved over a period beginning late April through the middle of May,” she said in an email.

Besides Valero, the facilities involve two in the Los Angeles suburb of Carson: a Phillips 66 refinery that suffered a fire and a Marathon Oil refinery that’s been down for planned maintenance.

The statewide average cost of a gallon of regular has increased 62 cents since Valero’s March 24 shutdown, according to AAA. It now stands at $4.006.

“We’ve had major refinery issues all spring,” said AAA Northern California spokesman Michael Blasky.  “I’ve heard it referred to as a perfect storm in the industry, with a lot of refinery incidents of flaring or shutting down for days or weeks at time.”

In fact, Chevron’s Richmond refinery experienced its seventh flaring incident of the year on Saturday, according to Contra Costa County’s chief environmental and hazardous materials officer, Randy Sawyer.  The incident caught the attention of the Oil Price Information Service.

Monday’s price marks the first time the statewide average cost for a gallon of regular has topped $4 in close to five years, Blasky said.

He said that while other factors have played a part in the rise — for instance, an increase in the price of crude oil worldwide — the refinery issues have been a major contributing factor.

“I would hope, as refineries come back to their normal levels of production, that we start to see prices level out and hopefully start to come down by mid-May,” Blasky said.

California Gas Prices Expected to Spike in Wake of Shutdown at Valero’s Benicia Refinery

Repost from KQED California Report

By Ted Goldberg, Mar 26, 2019
Valero’s Benicia refinery on March 24, 2019. (Solano County)

California drivers — or the millions of them whose cars still run on refined petroleum — can expect to pay more to fill up their gas tanks in the coming days thanks to the partial shutdown of Valero’s Benicia refinery.

The retail cost of a gallon of gasoline in the state is expected to rise immediately, according to David Hackett, president of Stillwater Associates, a transportation energy consulting company based in Irvine.

That’s after a 12-cent spike in wholesale gas prices on Monday, Hackett said.

“That price increase is likely to get passed through to motorists over the next week or so,” he said. “You’ll start seeing prices go up starting probably today.”

The average cost of a gallon of regular unleaded gasoline in California is $3.51, 16 cents higher than a week ago, according to AAA.

Several agencies are investigating a series of petroleum coke dust releases at the Benicia refinery that began more than two weeks ago. Those releases intensified on Sunday, prompting city officials to issue a health advisory.

The Valero refinery’s flue gas scrubber malfunctioned, a problem that led to a sooty plume of petroleum coke to billow out of the facility’s smokestacks. To deal with the problem, the refinery is slowly shutting down a significant part of its operations.

Last week, problems at two other California refineries contributed to the recent jump in gas prices.

AAA says a fire at a crude processing unit at the Phillips 66 refinery in Los Angeles County and a series of flaring incidents at Chevron’s Richmond refinery drove prices higher.

AAA spokesman Michael Blasky said price spikes are the norm when refineries suffer problems that lead to curtailed production.

“When a refinery goes offline and supply drops, retailers incorporate price increases almost immediately in California,” Blasky said.

Wholesale suppliers that sell fuel to gas stations and hear about the Benicia refinery’s shutdown will probably go into the so-called spot market to buy gas, sending the price up, Hackett said.

The refinery problems come amid a jump in the price of crude oil over the last year, which has sent gas prices up nationally.

Complaints Over Latest Flaring Event At Chevron Richmond Refinery

Repost from KPIX5 CBS SF Bay Area

Complaints Over Latest Flaring Event At Chevron Richmond Refinery

March 18, 2019 at 1:26 pm
Image result for chevron richmond refinery
Chevron Richmond Refinery

RICHMOND (CBS SF) – Four members of the public filed complaints with the Bay Area Air Quality Management District over flaring observed at the Chevron Richmond Refinery over the weekend.

The air district sent inspectors to the scene Sunday, and they are continuing to investigate the flaring, which Chevron said was caused by an upset in a process unit.

District spokeswoman Kristine Roselius said that so far, no notices of violation have been issued with regard to the incident, but detailed information about what chemicals were released into the air and why may not be available for months.

Roselius referred to flares as a safety device, burning very hot to protect public health by pushing the emissions high into the atmosphere to minimize their effect on nearby communities.

In a statement issued Sunday by Chevron spokesman Braden Reddall, the oil giant reassured neighbors that there was no environmental or health risk, and that flares are used to “relieve pressure during the refining processes.”

Members of the community interested in monitoring air quality around the refinery can do so at www.fenceline.org/richmond.

Sunday’s flaring is just the latest in a string of such occurrences, with eight flaring events reported in 2018 as well as incidents in January and February of this year. The latest reports of flaring

Air district officials have said each one is under investigation, but that in most of the 2018 incidents, the flares were burning off hydrogen, which burns very clean.