San Antonio-based Valero will permanently shut down its Delaware refinery this weekend, another sign of the U.S. refining industry’s woes.
Valero already closed a major refinery over the summer and cut two units in Delaware earlier. Refineries in the Northeast are particularly vulnerable because many are older, operate less efficiently and must compete with gasoline imported from Europe.
According to the AP, the Delaware City refinery, “where workers were notified of the closing Friday, lost about $1 million every day this year, said Valero spokesman Bill Day.”
The Delaware News Journal said a maintenance shut-down started earlier this month but it will “convert to a final closing. Plant employees will continue on the payroll for 60 days under federal rules for large-scale layoffs.”
“We’ve had potential buyers come in and look at the plant, but we’ve never had any viable offers for that property,” Day said. “We have thoroughly looked at other alternatives besides shutting the refinery down. There was really no avoiding the situation.”
Refiners have no incentive to restart units until there are some signs of economic recovery, meaning gasoline output levels will likely remain low for the foreseeable future.