22 March 2013 17:46 [Source: ICIS news]
HOUSTON (ICIS)--Shutting Tesoro’s 93,500 bbl/day Kapolei refinery in Hawaii will cause increasing price volatility for the state, an industry analyst said on Friday.
In January, Tesoro said it will convert the refinery to an import, storage and distribution terminal after it failed to sell the refinery at the end of 2012.
Closing the Tesoro refinery would leave the state with just one other refinery – the 54,000 bbl/day Chevron refinery in Honolulu.
“If the plant does not stay open, Hawaii will be left with just one small refinery, opening the doors to increasing volatility should the remaining facility suffer set backs or perform maintenance,” said GasBuddy.com’s Patrick DeHaan.
Earlier this week, the United Steel Workers (USW) union delivered 5,000 petitions to Governor Neil Abercrombie, requesting his help in finding a buyer for the Kapolei refinery.
The activists also requested that the governor appoint a USW representative to his committee that is examining the effect of a Tesoro refinery closure on the Hawaii economy. The USW represents the majority of workers at the refinery.
“While the United States Steel Workers union has an obvious vested interest in keeping the refinery open, it is also in Hawaiian motorists’ interests to keep the plant running to minimise the chance of future price spikes,” DeHaan said.
The USW said it expects a response from the governor.
“Turning the refinery into a terminal and importing fuel is likely to bring higher gas prices and possibly supply problems. Why should the fuel be refined overseas when we can do it right here at home and not throw people out of work?” said Local 12-591 unit chair Pat Koge.
Koge said closing the refinery will result in the loss of 210 jobs and 2,000 other jobs “that are dependent on the refinery and workers’ pay checks.”
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