Oil companies try to scare us away from limiting fuel production by saying it would increase prices. But demand for fossil fuels is actually decreasing in California and throughout the US West. This should be a good reason for ramping down production. Instead, California refineries are pivoting to export an increasing amount of their products—now about 1/3—including the dirtiest fuel, petcoke.
This map shows where California refinery fuel exports go.
Key quote: “Refiners in California have already pivoted toward export of the dirtiest-burning fuels they refine here. Now a crucial question arises: Instead of phasing down oil refining as the state moves toward zero emission vehicles, will refiners here pivot to export more and more of their ongoing fuels production? Tracking exports from refineries in California matters.”
[Note from BenIndy: It is fascinating how hard it is to find and pin down good coverage of industrial accidents – especially refinery fires, plant explosions, and so on – when they occur in Texas. We have Common Dreams and ABC13/KTRK in Texas to thank for their coverage today. Perhaps more information about the source of the fire, the danger the toxic smoke and particles in the air in Shepherd may pose, and any additional impacts will be made more available tomorrow. From one refinery town to another, Benicia surely sends Shepherd its heartfelt hopes for a speedy recovery for the town, a thorough investigation of the root causes for this absolutely heinous disaster, and the creation of additional protections for the safety and health of its residents.]
Aerial view of chemical fire in Shepherd, Texas on November 8, 2023. | Fox News 26 / Screenshot.
The explosion resulted in a massive fire as residents in and around the town of Shepherd were ordered to stay inside and turn off their HVAC systems to avoid contact with the toxic smoke and particles in the air.
Common Dreams, by Common Dreams Staff, November 8, 2023
At least one worker was reported injured and the surrounding community placed under a shelter-in-place order after an explosion at a chemical plant in the town of Shepherd, Texas on Wednesday resulted in a monstrous and toxic fire.
Roughly 60 miles north of Houston in Jacinto County, the explosion and subsequent chemical blaze took place at the Sound Resource Solutions facility, a petroleum processing plant. A source told ABC 13 News that a 1,000-gallon propane tank sits in the middle of the fire while various highly flammable toxic chemicals and materials are used at the plant.
Shelter-in-place order issued after chemical plant explosion in Shepherd, Texas; smoke visible for milespic.twitter.com/0krc7baQlk
“Polk County Emergency Management recommends that residents along US Hwy 59 from Goodrich to Leggett shelter-in-place and turn off HVAC systems in homes and businesses immediately,” said a local emergency response from officials in neighboring Polk County. “At this time, the effects of the chemical in the air are unknown.”
BREAKING: Massive explosion at a chemical plant in Shepherd, Texas, residents ordered to shelter pic.twitter.com/7csSMETw7S
According to the Sound Resource Solutions website, the chemical products and solvents used or generated at the processing plant include: xylene, toluene, acetone, methy ethyl ketone, phosphoric acid, acetic acid, sulfuric acid 93, various isoproply alcohols, hexan, and others.
Local affiliate Fox 26 was providing live coverage:
There is no confirmed information about the cause of the fire, though some local outlets reported talking with workers who said a forklift accident may have been the initial cause that set off a larger chain reaction.
In 2006, James Feldermann got hired as a trainee at a refinery in Martinez, California, in the Bay Area. It was hard work, with 12-hour-minimum shifts, but Feldermann came to excel at it. He learned how to isolate pipes and vessels, load railcars with molten sulfur and ammonia, and helm an industrial control panel. In time, he rose to the position of head operator at the Marathon Petroleum site. The job paid well, and he enjoyed it. He expected to stay until retirement.
On a Friday afternoon in July 2020, Feldermann was abruptly summoned to an all-hands Zoom meeting. While some of his colleagues struggled to get the audio to work, Feldermann received a phone call from his union representative. “I didn’t actually hear management tell us that they were laying us off,” he told me. The plant was being shut down, as the rise of work-from-home and the spread of electric vehicles depressed Californians’ demand for gasoline. Feldermann and his co-workers would be out of a job in 90 days.
The United States is embarking on an epochal transition from fossil fuels to green energy. That shift is necessary to avert the worst outcomes of climate change. It also stands to put hundreds of thousands, perhaps millions, of people like Feldermann out of work. The result could be not only economic pain for individual families, but also the devastation of communities that rely on fossil-fuel extraction and a powerful political backlash against green-energy policies.
A pathbreaking new study[BenIndy editor: see indent below] shows just how real the damage could be, absent policies to soften the economic blow. Virginia Parks, a professor at UC Irvine, and Ian Baran, a doctoral student, tracked the consequences of the Marathon shutdown in near-real time, getting more than 40 percent of the workers to return surveys and a smaller group to sit for interviews. They found that, more than a year after the shutdown, one in five Marathon workers was unemployed. Their earnings had declined sharply, with the median hourly wage of employed workers plunging from $50 to $38. Some workers were earning as little as $14 an hour. And those new gigs came with more dangerous working conditions.
To prevent other workers from experiencing the same, the Biden White House has promised to pursue a “just transition,” employing policies to ensure “new, good-paying jobs for American workers and health and economic benefits for communities.” But the green-energy transition is already underway. And it is not clear that it will be just.
The legendary American union leader Tony Mazzocchi pioneered the concept of a just transition a half century ago. Some industries are too toxic for society, he argued. But to shut them down in a way that punishes the workers in those industries, or the places where those industries are concentrated, would be unjust.
Just-transition policies are not merely about bailing out blue-collar folks. They are meant to defray the cost of having whole communities fall into persistent economic distress: a loss of social cohesion, people living shorter and sicker lives, the rise of “deaths of despair,” the growth of right-wing populism. They are also meant to generate political support for green policies, or at least dampen any backlash. Without them, “you risk dissuading future efforts that are for the societal good,” J. Mijin Cha, an environmental-studies professor at UC Santa Cruz, told me. “If we’re doing things that are for the benefit of society but screw over a bunch of people, that’s not a societal good.”
These policies have worked. The Ruhr region in western Germany, for example, once produced coal, iron, and steel, with extractive and heavy industry employing a majority of the region’s workers. The German government, labor unions, and industrial leaders came to a series of agreements to diversify its economy, providing payments for displaced workers and making investments in service-and-knowledge businesses. Employment in coal mining in the region went from 473,000 in 1957 to zero by the end of 2018. The area lost nearly 1 million production jobs but gained nearly 1 million service jobs.
Yet it is hard to identify many, if any, just transitions in the United States. Appalachia lost its coal jobs and gained an opioid epidemic. Detroit deindustrialized and fell into poverty and disrepair. The decision to open up trade with China sent millions of American manufacturing jobs overseas, and policy makers did little to create any in their place. Now the planned obsolescence of the fossil-fuel industry threatens to create new Rust Belts in regions economically dependent on extraction, such as the Permian Basin, in Texas, or the Bakken Formation, in Montana and North Dakota.
The problem is threefold. First, the United States does not invest heavily in industrial policy or place-based policy compared with some of its rich-country peers, though the Biden administration has started to push billions of dollars into both. If coal is leaving a region, Washington historically is not sending anything else in. Second, the country has lower rates of unionization and a much thinner safety net than other wealthy nations, making workers more vulnerable to the effects of mine closures and plant shutdowns. Third, the Republican Party tends to reject the premise that the country needs to move away from fossil-fuel production at all, making them a weak partner in setting up just-transition plans.
No wonder the Marathon shutdown went the way it did. John Bayer, a safety specialist, lost his job at the site, as did his two brothers. He told me that he was not offered any form of government help, aside from unemployment insurance. Bayer, who has two kids, sent out about 50 applications and received just two callbacks. He ended up at an agriscience firm that nearly matched his Marathon wage but provided fewer opportunities for overtime. “I ended up with a $60,000-a-year pay cut,” he told me.
James Feldermann wound up taking a job based in Reno, Nevada, for $17 an hour less than he was making at Marathon. He rented a small studio apartment there and spent months driving 200 miles back to the Bay Area every weekend to see his wife and son.
Both the state of California and the Biden administration are in the process of developing plans for a just transition to green energy. Those plans were too late for the Marathon employees. Many labor leaders, academics, and politicians think those plans are almost certain to be too little for fossil-fuel workers losing their jobs in the near future.
On paper, the challenge seems straightforward. The United States has roughly 120,000 oil-and-gas workers and 40,000 coal miners. The green-energy sector is adding at least that many jobs every year. Supply, meet demand. Why not create a job-matching service for those laid off; provide them with wage subsidies, transition assistance, and relocation funds; and watch the country’s emissions turn from smoke-gray to vapor-white?
A few reasons. For one, fossil-fuel companies employ about 1.7 million workers in the U.S., not 160,000, once you factor in all the labor not directly involved in extraction and refining. It takes a lot of workers to transport fuel, manufacture secondary products from it, and power communities with it. And it makes little sense to transition many of those workers directly into green-energy jobs. Oil-and-gas gigs tend to pay far more than solar and wind do. And workers in extractive industries tend to develop valuable, specialized skill sets, as Feldermann did. Their technical chops would be wasted selling rooftop solar systems, and their salaries would get cut in half.
The government also faces the challenge of supporting whole communities dependent on fossil-fuel extraction, not just individual workers. “Fossil-fuel companies tend to be dominant employers where they are located,” Michaël Aklin, a professor of economics at the École Polytechnique Fédérale de Lausanne, in Switzerland, told me. “When they shut down, the central node in that local economy disappears.” The consequences ripple out to the businesses and institutions that rely on the money those workers used to spend and the taxes they used to pay.
The crux of the Biden administration’s plan for a just transition thus far is a policy granting tax incentives to businesses investing in “energy communities.” In the long term, that might encourage companies to locate warehouses and jobs in the places where oil, gas, and coal facilities are closing. But incentives are, well, just incentives. What if private businesses choose not to locate in certain parts of Louisiana or North Dakota, despite the tax breaks on the table? What if they create jobs years after a shutdown has done its damage? What happens to places where no business wants to invest?
At this point, neither Sacramento nor Washington has developed a robust plan to reach out and help oil-and-gas workers one by one. That’s a necessary component, UC Irvine’s Virginia Parks told me. The government, she argued, should provide financial support to cover the gap between workers’ pre- and post-layoff wages, as well as aiding workers close to retirement. Legislators should set up programs to certify the workers’ skills so that outside employers can see just how qualified they are. Finally, the government should provide retraining and job-match services.
Last week, Tracy Scott, the president of the United Steelworkers Local 5, the union representing the Marathon employees, drove me around the closed refinery complex. It sits on emerald-green marshland near where the Carquinez Strait empties into San Pablo Bay. When we visited, the heavy machinery once used to turn sour crude into gas and petrochemicals was surrounded by a superbloom of California poppies and wild mustard. We both remarked on how beautiful it was. A little later, Scott told me that refinery workers tend to die young, and rarely get to take advantage of the retirement packages the union negotiates for them.
This place does not deserve to be burdened with this refinery, I thought. And these people do not deserve to suffer for its closure.
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.
“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.
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