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RE: Delek in Talks buy Another US Refinery

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Charles Randall

Here is news item on Delek looking to buy another (owns previous La Gloria/Crown Tyler Refinery now) US Refinery in 75-100 MBD range. Wonder if the partner is Valero selling one of its smaller refineries?
The size mentioned does match profile of two Oklahoma refineries that are currently on the block:
Valero Energy Corp and Sunoco have entertained offers on their refineries in that state. Delek may also be a contender for Valero’s Memphis or Krotz Refineries although Memphis is larger than cited range
Delek buying a refinery now is bold move since refinery margins have been dropping since January due high crude prices & weak gasoline demand.  But Delek has been seeking a second refinery since it went public & with its single Tyler Coking refinery it is behind the curve with other small refiners like Alon & Western Refining who have both closed deals recently leaving Delek without similar economy of scale to its peers. 
It is looking at this acquisition to expand all 3 areas of its business. Delek is an Israeli conglomerate operating 3 segments: Refining, Marketing & Retail. The refining business runs the Tyler 60 MBD coking refinery, the marketing segment sells refined products on a wholesale basis in west Texas, and the retail segment sells gas as well as operates network 400 company-operated retail fuel & convenience stores.  

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