01 November 2011 17:51 [Source: ICIS news]
HOUSTON (ICIS)--Surging gasoline and distillate margins and discounted crude throughput for the third quarter pushed Valero earnings about 40% higher, the company said on Tuesday. ($1 = €0.72)
Valero net income rose to $1.2bn (€864m) from $292 in the same quarter last year.
Profits for gasoline refining from Louisiana Light Sweet crude were up 89% at $8.20/bbl compared with the third quarter of 2010, while ultra-low-sulphur diesel profits jumped 66% to $14.19/bbl.
In addition, Maya crude oil was at a $13.38/bbl discount to Louisiana Light Sweet crude, an increase of 20% on a year ago. Finally, mid-continent crude and Eagle Ford basin crude were at a discount of $22.47/bbl to West Texas Intermediate (WTI) crude, widening by about $15/bbl from mid-continent crude's discount in 2010.
During the quarter, Valero processed more than 460,000 bbl/day of the discounted Eagle Ford crude at its 93,000 bbl/day Three Rivers and 142,000 bbl/day Corpus Christi refineries in Texas. That was more than 40,000 bbl/day higher than in 2010, and the Eagle Ford crude saved the company about $15/bbl compared with processing imported sweet crude.
The higher profits from production of gasoline and distillate provided an incentive to increase throughput at the company's refineries, Valero executive vice president Mike Ciskowski said. As a result, refinery throughput jumped by 389,000 bbl/day for the quarter.
The increase in volumes was also a result of added capacity from the acquisition of the 220,000 bbl/day Pembroke refinery in Wales on 1 August and operations at the 235,000 bbl/day Aruba refinery, which was down in 2010.
“We were able to capitalise on favourable refining margins and attain our highest refinery utilisation since the third quarter of 2007,” Valero CEO Bill Kleese said.
($1 = €0.72)
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