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Sunoco sees refinery offers
By JASON WOMACK World Staff Writer 12/13/2007
Interest in the west Tulsa plant is unsolicited, the company says, but each proposal is evaluated.
TOM GILBERT / Tulsa World
The Sunoco Inc. refinery in Tulsa is west of the Arkansas River, near downtown.
Sunoco Inc. has received and considered unsolicited offers for its Tulsa refinery, a company spokesman acknowledged Wednesday.But the Philadelphia-based refiner and marketer of petroleum and petrochemical products stopped short of saying the 85,000-barrel-per-day plant is for sale.
“We received unsolicited requests to discuss the refinery, and you evaluate those,” Gerald Davis said, adding that the company is examining what the value of the facility may be to others.
Paul Sankey, an analyst at Deutsche Bank in New York, told Bloomberg News that “the drumbeat is rising with regard to the potential sale of Sunoco’s Tulsa refinery.” The west Tulsa plant, which employs 375 people, primarily produces lubricants.
Sunoco is investing $400 million to add equipment and infrastructure at the plant. The project, scheduled for completion in 2010, will give the refinery the ability to convert high-sulfur heating oils to low-sulfur diesel, Davis said. He said the investments will not affect the number of employees at the refinery.
During a November conference call on company earnings, an executive at Dallas-based Holly Corp. said the Tulsa refinery may be for sale. Sunoco declined to comment on the remark at the time, saying only that the company continues to operate the plant at the “highest professional standards.”
The refinery was acquired by Sunray DX in 1968. Sunray later merged with Sun Oil Co., forming Sunoco. A 2005 report by the state secretary of energy’s office estimated that the refinery directly contributes $50 million to the Tulsa area economy.
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Here is recent news article on unsolicited Sunoco offer for Tulsa Coking Refinery – appears one of the offers may be from Holly since this article was sourced to Holly executive, but other versions indicate more than one “offer” may have been made As this article mentions the 85MBD Tulsa refinery has $400MM project for LS Diesel due complete in 2010.
Sunoco was recently upgraded by Soleil Securities analysts to a “Buy” citing the refinery sale, putting its coke assets into a master limited partnership, or divesture of its chemical business as moves that would significantly improve earnings. (AP 12/11/07 – http://www.msnbc.msn.com/id/22198572/ ). Note – The coke refered to here is Sunoco’s Coal Coke operations (~$24MM) via SunCoke Energy (formerly Sun Coke) in Victoria, Brazil, its Jewel Coal operations, the Indiana Harbor Coke plant and a proposed second 550 kmtpy Havermill site (with 67 MW HRSG at cokemaking plant) operational in 2008.
Lots of other non-coking Sunoco refineries in the news –
Sunoco Philadelphia Refinery (Monday) fire/explosion that injured 3 people was sourced to a welding tourch. (Jersy AP article http://www.courierpostonline.com/apps/pbcs.dll/article?AID=/20071211/NEWS01/71211016 )
The Sunoco Toledo refinery is taking shutdown for repair work on crude & fluid cat cracker (FCC) work next fall with possibility part work could start in March 2008. (article http://www.toledoblade.com/apps/pbcs.dll/article?AID=/20071213/BUSINESS03/71213008 )
<Note there was older May 2006 article in “Insulation Outlook” magazine that featured Sunoco Refineries in their Insulation project which started with Toledo Refinery & ended with Tulsa Refinery. See at http://www.insulation.org/articles/article.cfm?id=IO060502 >
Regards
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