Bloomberg News

California-Blend Gasoline Strengthens After Valero Has Breakdown

January 23, 2012

Jan. 23 (Bloomberg) -- California-blend gasoline in Los Angeles strengthened against gasoline futures after Valero Energy Corp. reported a breakdown at the Wilmington oil refinery in Southern California over the weekend.

Carbob in Los Angeles climbed 1.5 cents to a premium of 11 cents a gallon against gasoline futures traded on the New York Mercantile Exchange, according to data compiled by Bloomberg. Prompt-delivery of the fuel rose 1.62 cents to $2.8956 a gallon.

San Antonio-based Valero reported a breakdown at the 135,000-barrel-a-day Wilmington refinery Jan. 21 that may cause the plant to flare through Jan. 28, according to a notice with the South Coast Air Quality Management District.

“The flaring was due to a problem with a compressor at the vapor recovery unit,” Bill Day, a Valero spokesman in San Antonio, said in an e-mailed statement. “The refinery remains down for the turnaround, so no impact on production.”

Valero began shutting units at the plant Jan. 13 to perform four weeks of work on the crude unit and coker. Other production units will also be shut during the maintenance turnaround, Day said.

Carbob in San Francisco strengthened 1.5 cents to a premium of 5 cents against futures.

Tesoro Corp. was starting units at the 95,000-barrel-a-day Kapolei refinery in Hawaii that were shut last week for maintenance following multiple power failures, Tina Barbee, a Tesoro spokeswoman at the company’s headquarters in San Antonio, said in an e-mail.

The Kapolei plant was forced to shut some units and reduce rates at others because of the interruptions, triggered by bad weather, she said.

Tesoro is also conducting maintenance at the 170,000- barrel-a-day Martinez refinery in Northern California and the 97,000-barrel-a-day Wilmington refinery in Southern California. The company has the ability to ship refined products from its California refineries to Hawaii.

California-blend diesel in San Francisco was unchanged at a discount of 1 cent a gallon against Nymex heating oil futures. The same fuel in Los Angeles slipped 1.37 cents to a premium of 1.13 cent against futures.

Conventional, 87-octane gasoline in Portland, Oregon, fell 2 cents to a discount of 7.5 cents to futures, the lowest level since Aug. 5.

--Editor: Richard Stubbe

To contact the reporter on this story: Lynn Doan in San Francisco at ldoan6@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net


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