July 8, 2009 at 3:17 pm #3061
Voros: Chevron refinery fight killing jobs
Drew Voros, Business editor
ContraCosta Times Posted: 07/07/2009
Suddenly and unexpectedly, the Bay Area is quickly in danger of losing its manufacturing mojo and the thousands of jobs that come with industrial output.
First, Fremont found out last week that it might lose its GM/Toyota auto factory and the 5,000-plus jobs housed in the heart of the city. Days later, a court order drew a dark labor cloud over Richmond’s biggest employer at Chevron’s refinery complex that hugs the Bay Area’s east shore.
While environmentalists were celebrating a legal victory stopping key expansion work at Chevron’s Richmond refinery, the first of 100 union iron workers and pipe fitters there began their holiday weekend freshly unemployed.
Unfortunately, another 900 of those same good-paying, contracted jobs are in jeopardy from the court ruling that stopped a multiyear retrofitting project Chevron designed to process more domestic crude and rely less on the high-grade or light Saudi Arabian and Iraqi oil shipped in today.
Those 1,000 jobs are just the drip that could become a gusher if Chevron is forced to abandon the Richmond retrofit all together.
Not only is the San Ramon-based oil giant considering transferring the entire retrofit project to its refinery in El Segundo, the Richmond refinery’s long-term value and usefulness and its nearly 3,000 jobs are thrown into question.
With refinery margins and overall oil earnings being reduced by the fall of oil prices during the past year, Chevron must be able to process different types of petroleum, particularly the cheaper-to-transport domestic crude, to achieve needed returns on its ongoing Richmond investment.
Last Thursday, Contra Costa County Superior Court Judge Barbara Zuniga said that Chevron must clarify in its environmental report whether the expanded facility will process heavy crude oil, which generates more pollution than lighter crude.
Chevron says it plans to refine light and intermediate crude at the expanded refinery, not heavy crude. Will Rostov, an Earthjustice attorney who filed the suit, says the judge’s decision means the city of Richmond will have to study Chevron’s expansion plans more critically.
The legal wheel turns slowly and mires in appeals and delays that a business built on reacting quickly to economic events is able to work around rather than wait on. In Richmond, the immediate threat is that Chevron’s retrofit and its 1,000 retrofit jobs will go south along with future development of the 107-year-old refinery Richmond was built around.
The circuitous legal argument put forth by Earthjustice that Chevron’s expansion will harm the environment is precisely the type of court fight that will stick in the bowels of justice for years. Chevron will not wait.
In one short week the face of the Bay Area’s manufacturing base suddenly takes on that different, worrisome look that change is in the air.
Two of our largest manufacturing employers are fighting the worst economic conditions of a lifetime. They have been hit with body blows that could knock out thousands of never-to-be-replaced
July 8, 2009 at 3:24 pm #6080
FYI – The results of problems with Liberals attacking Manufacturing base during a recessionary period and then celebrating their victory even as it displaces more jobs and reduces the tax base & revenue support should be a criminal event.
And it is a good advance look into what could be coming for the rest of the US since the Obama administration had several of these California idiots in charge of drafting the Stimulus package and its anti-industry/manufacturing programs.
We are now in the 19th month of this recession which is now longer than any past recession (previous 2 were 16 & 18 months max)…except the 1929 depression (48 months) and so within 6 months the Government will have to fess up that we are in a depression (or at least half way thru one) but not before we have another downward correction to form a bottom so that the recovery can truly begin (we currently have a bear trap getting ready(already started?) to correct from an oversold position). Good news is that we are halfway thru & headed towards the recovery portion – but programs like the Carbon Tax/Obama Energy Program are going to intensify consolidation and shutdown portion of the Oil/Energy Industry.
July 9, 2009 at 3:45 pm #6076
Just few news items on some leading edge Small refinery closing examples due Energy/Global Warming/Carbon tax actions by current congress bills:
An oil refinery in El Dorado that presently employs 1.200 workers says it will have to close if Congress
<Chevron Richmond Refinery expansion halted for stronger enviromental review may cancel contracosta area project and lead to plant sale/closing of 1930’s plant/units>. (See earlier news posting on coking.com
Even though Congressional actions on increasing Ethanol use & adding Carbon Tax/Energy Bill actions are already in progress – There was some good news on the Climate Change bill Thursday via pushback & delay to Sept 2009=
Obama’s drive for climate change bill sees delay
President Barack Obama’s push for quick action by Congress on climate change legislation suffered a setback on Thursday when the U.S. Senate committee leading the drive delayed work on the bill until September.
FYI some Other Country closings impacted via economy
Shell may sell or shut Montreal East refinery Decision should be made in the next few months; refining margins are expected to
Valero Aruba Refinery is shutting down for 60-90 days due to poor refinery economics/margins and has been on sale block since 2008.
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