Valero Completes Sale of Paulsboro Refinery

abarrelfullabarrelfull wrote on 20 Dec 2010 06:35
Tags: deals pbf refinery usa valero


Valero Energy Corporation (NYSE: VLO) announced today that it has completed the sale of its Paulsboro, N.J. refinery to PBF Holding Company LLC, a wholly owned subsidiary of PBF Energy Company LLC.

The total proceeds were $707 million, consisting of $340 million for the refinery plus $367 million for net working capital, inventories, and other adjustments. Consideration received by Valero at closing consisted of $547 million in cash and a note for $160 million from PBF Holding Company LLC. The net sales price for the refinery was adjusted from the previously announced $360 million mainly due to changes in crude oil supply economic assumptions.

“We continue to execute on our strategy to improve our portfolio,” Valero Chairman and CEO Bill Klesse said. “By divesting non-core assets, Valero has generated $877 million of cash within the past month when combined with the $330 million in proceeds before taxes from the recent sale of the Cameron Highway Oil Pipeline System. This increase in our cash balance improves our ability to internally fund our high-return growth projects and any potential acquisitions.”

For financial reporting, Valero plans to report the Paulsboro refinery results as discontinued operations. As a result, the Northeast refining operating region will consist solely of the Canadian refining and wholesale operations, and continuing-operations guidance for the fourth quarter has been revised to the following: Northeast refining throughput volumes in the range of 205,000 to 210,000 barrels per day. Also, the Paulsboro transaction will result in a non-cash, pre-tax charge estimated at $938 million within discontinued operations in the fourth quarter.

About Valero:
Valero Energy Corporation is an international manufacturer and marketer of transportation fuels, other petrochemical products and power. Its assets include 14 petroleum refineries with a combined throughput capacity of approximately 2.6 million barrels per day, 10 ethanol plants with a combined production capacity of 1.1 billion gallons per year, and a 50-megawatt wind farm. Valero is also one of the largest retail operators with approximately 5,800 retail and branded wholesale outlets in the United States, Canada and the Caribbean under the Valero, Diamond Shamrock, Shamrock, Ultramar and Beacon brands. Based in San Antonio, Valero is a Fortune 500 company with approximately 20,000 employees. Please visit www.valero.com for more information.


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