January 30, 2012 at 11:56 am #1955
<Comments from contact who forwarded Valero Letter: I thought you might like to see this. An ex-Valero man sent it to me saying he had received it from friends in the oil patch. Use with caution as I cannot verify it.
I dont know if this is true. I do know that Valero invested very heavily 15-20 years ago along the gulf in heavy oil refining. This is completely plausible.>
Pertinent information not only for the industry in which I work but for every citizen of the USA
Date: January 24, 2012
To: Valero Employees
From: Bill Klesse, CEO Valero
Subject: Keystone XL Pipeline Statement
As you know, the Obama administration decided last week to deny TransCanadas application to ship crude oil via the Keystone XL pipeline from Canada to the Gulf Coast. Valero has planned to be a shipper and purchaser of that oil since 2008, and obviously we were disappointed in the decision. We issued a statement in response to questions from the media, and I wanted to share it with you in case you get questions from friends or business partners, and so that you would know why Valero supports the Keystone XL pipeline. This is the statement:
Despite the uncertainty and political fighting over the Keystone XL pipeline, Valero has continued to invest in its U.S. refining operation. In 2011 we spent nearly $3 billion on projects, and for 2012 our capital expenditure budget is over $3 billion. These expenditures are keeping our employees on the job and putting additional people to work. To reference two of our refineries, at Port Arthur, Texas, we have 1,600 contractors working on an expansion project, and at St. Charles Parish, Louisiana, we have another 1,000 contractors working on a separate project. We need this kind of economic activity to accelerate to help all Americans.
This illustrates why the federal governments rejection of the Keystone XL pipeline is so absurd. There are pipelines in every neighborhood all across America. The administrations decision was not about pipelines, it was about the misguided beliefs that Canadian oil sands development should be stopped and that fossil fuel prices should increase to make alternative energy more attractive. Instead, we should be impressed with how well the oil sands engineering and recovery technology has advanced, and the economic benefits this development brings. Having more oil available in the marketplace has the potential to lower prices for consumers. As an independent refiner, Valero buys all of the oil we process. Due to the administrations misguided policies, refiners like Valero will have to buy more oil from other sources outside the U.S. and Canada. Consumers will bear the additional shipping cost, not to mention the additional greenhouse gas emissions and political risks.
With all the issues facing our country, it is absolutely unbelievable our federal government says no to a company like TransCanada that is willing to spend over $7 billion and put Americans to work on a pipeline. The administrations decision throws dirt into the face of our closest ally and largest trading partner.
The point above is that it is not about pipelines as many pipelines cross the Ogallala Aquifer, in the Great Plains region, and, in fact, there is already significant oil and gas production in the area covered by the aquifer. This is politics at its worst.
Thanks for your support.
<See EIA Inter & Intra State Pipelines for Gas & Oil Maps at thier websites>
January 30, 2012 at 11:58 am #4729
RE: Valero Bill Klesse Letter Keystone P/L
I Think this is a real Valero letter – here is link to it at Valero Website below.(They also have less confrontational version posted at website):
Voices for Valero = http://www.valero.com/OurBusiness/VoicesforEnergy/Pages/default.aspx ; and
Your Bill Klesse leter = http://www.valero.com/OurBusiness/VoicesForEnergy/Documents/Barack%20Obama%20Letter.pdf
So you at least have thier website verification on letters sourcing!
February 1, 2012 at 10:58 pm #4719
Don’t know how much truth there is to it, but a lot of the anti Keystone arguments I have heard lately center around the notion that some of the Gulf Coast refiners (Valero especially) want the Canadian crude in order to export to other Countries. This seems ludicrous to me in light of the recent start ups of export oriented refineries in Brazil, India, etc who are starting to flood this Country with refined product but it carries some currency in the public mind and whether it is true or not, it is very hurtful to those who are trying to get the pipeline approved.
February 1, 2012 at 11:36 pm #4718
Chris you are dead on & its just another example of the liberal anti-oil twisting the truth to fit the story they want.
I deleted one previous links because what looked like Valero news item was Environmental blog rant about just what your talking about.
What they were doing is taking the fact that Valero intent to increase take of Canadian Oil Sands crude to fill in holes left by Venezuelan and Mexico underproduction of heavy crudes and then export some of the products (not crude as they try to say) in order to capture the higher value rest world has on diesel. The half-lie here is that they are claiming exporting US fuel products is ~same as exporting CA crude. Not the same & whole US has been taking advantage (until EPA/Environmental nuts started killing off Refinery capacity).
The folks pitching those lie’s are ignorant of lot refining aspects but 2 in particular – 1) they have killed off so many small refineries thru regulations that we have basically only 6 states doing 75% US refinery gasoline & diesel production – 4 of those are in Gulf Coast so naturally if CA’s want move big volumes crude has go there. and 2) This crude WILL BE PRODUCED – if it doesnt come to US it will go CA West Coast & then to China/Asia Pacific and that will be one time choice either way when the P/L is layed the option reverse decision is DOA. Which is what they are hoping – as NIMBY idiots they dont really care about environment just dont want it in thier back door – otherwise they would be going after China as worlds leading polluter now & largest growing consumer of crude.
Another point liberal media & these guys dont understand is that once the US stops importing gasoline (were are essentially balanced with depressed job market & higher add of ETHANOL) then the rest of world doesnt have place to dump its extra gasoline exports and if that is case they have run the refineries on “Diesel Economy” which is limited by how much gasoline their domestic and chemical market can use and pay for at $100/Bbl crude cost. The Global Refining sector uses more diesel than gasoline but they cannot run at higher utilization rates of 85-93% without place export gasoline & so have drop back to 70-75% utilization numbers – which is what Russia/Africa/Asia lot regions were operating at before the US had start importing because regulations eleminated economic ways make gasoline (no lead, limited Butane, limited Light St Run gasoline, limited alky, no MTBE, limit Reformate ect ect).
Good news is that both East Coast and West Coast liberal idiots that spawned most this crisis will be in long pump lines or walking when next round Gulf Hurricanes hit. But they are hoping if they kill off the fossil fuel alternatives and prices get high enough their beloved Electric & LNG cars will take over. The technology isnt there & wont be rushed – even if it did, no one US will be able afford it with regulations killing off MFG jobs faster than companies can grow them.
Please start logging into newspapers when you see these things – or go to your local meeting where they buss these Serria guys in to make it look like everyone in state is against oil sector.
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