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Chevron to try again to upgrade Richmond refinery
Tuesday, May 24, 2011 WOPULAR / SFGate
After Chevron’s last attempt to upgrade its aging Richmond oil refinery bogged down in court, the company has decided to try again. Chevron Corp. on Monday reported that it will once again ask Richmond officials for permission to renovate the refinery, improving its ability to process high-sulfur crude oil.
Richmond’s City Council narrowly approved the upgrade in 2008, despite complaints from environmentalists that the changes could lead to more air pollution in a community that already had too much. A judge halted construction work on the project the following year, ruling that Chevron had not answered key questions in the project’s environmental impact report. The company, based in San Ramon, must now revise or redo that report.
“We’ve got this half-built, and we want to move forward,” said Chevron spokesman Dean O’Hair. This time, the company has scaled back the renovation. It will no longer include adding a continuous catalytic reformer that would have allowed the refinery to churn out more California-grade gasoline. The company has also dropped plans for a small co-generation power plant that would have supplied steam to the catalytic reformer.
Those changes reflect a significant shift in California’s gasoline market.
California uses its own unique fuel blends as a way to fight air pollution, and only a limited number of refineries make those blends. When the Richmond upgrade project was first under consideration, the state’s thirst for gasoline was growing, but supply wasn’t. Squeezing a little more out of the Richmond refinery made sense.
“At the time it looked like the market needed it,” O’Hair said. But gasoline sales in the state peaked in 2005, as rising prices forced Californians to drive less. The recession also undercut demand. And California’s decision to increase the amount of ethanol it blends into gasoline increased the overall fuel supply, lessening the need for refinery expansion -
I saw this update on CVX Richmond problems but limiting posts because it is same sad old story about Calif Refineries vs. Environmental crazies. Chevron’s script / next actions are ~ already pre-set/defined as to what is going happen!
They wont let them expand, wont let them try process economic heavy crudes (talks got killed because Contra Coasta Environmental crazies are one groups trying kill off all Canadian Bitumen crude development), and will block all expansions unless they get big greenmail payout ( Thank’s COP for setting that precedence – which they had do go ahead with theirs …..but now funds helps them with all other attacks).
The CVX guys will eventually give up & try shutdown or do conversion to Terminal (avoid heavy clean up cost) but surprise is in store there too, because once they give up ……. then the locals sue them not shutdown because puts area in tax/employment/supply crisis & cost gasoline goes thru roof! There will be lag on this due to post-recession gasoline demand collapse & high cost gasoline California due restrictive spec’s on Calif gas that put it +$0.50-1.00/gal higher rest US. Also California now has such a unique “Boutique” gasoline blend that few can (or want to due cost) make it.
Why cannot anyone give the straight story on what these Environmental idiots are doing? Most Upstream Majors are going dump this state (BP, Shell, XOM and suspect COP soon after) and then they are SOL – since California is one of big US 7 producing states (i.e. they ~75% all US gasoline) providing domestic exports to all the surrounding/other western region states.
So not only does California go into supply crisis & must import from China ( US still has stupid Jones act blocking rest US supplying WC area) but all states like Arizona (now 5 years fighting crazies to get new grassroots refinery even though everyone in state/city/neighborhood needs & wants it)! Do you remember when Phoenix had one two major pipelines (one from Calif & larger one Texas) that supply them break & residents spent hours in lines gas stations? Well most Padd 5 is like that (just part of 39 US states that have little to no refining capacity) outside of two states: Washington & California refinery producing states.
Regards
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