Bloomberg News

Pennsylvania Lawmakers Vow to Fight Closing of Refineries

February 21, 2012

(Updates with company comment beginning in sixth paragraph.)

Feb. 15 (Bloomberg) -- Pennsylvania lawmakers joined members of the United Steelworkers union at a rally today in Washington to oppose the planned closing of three refineries in the state.

“There’s no issue that’s more important to me than this,” said Senator Pat Toomey, a Republican.

ConocoPhillips idled a refinery in Trainer last year. Sunoco Inc. has idled its refinery in Marcus Hook, and said it would also close a plant in Philadelphia. The companies have said they have sought buyers for the facilities.

Refiners in the northeastern U.S. are struggling to turn a profit because of the narrow margin between the cost of imported crude and fuel prices.

No clear legislative response to the planned shutdowns emerged at the Washington meeting. Union members and U.S. lawmakers said the closings would cost jobs and raise gasoline prices in the U.S. Northeast.

About 110 workers, or one-third of the hourly workers at Marcus Hook, were told this week not to return to work next week, Thomas Golembeski, a spokesman for Philadelphia-based Sunoco, said in a telephone interview today. Those workers will be paid through the end of February and then will receive a severance, he said. Sunoco has helped to organize outplacement workshops and a job fair for employees, he said.

Hearings Planned

Representative Pat Meehan, a Republican, said the House Homeland Security Committee would hold hearings on the planned shutdowns. Representative Chaka Fattah, a Democrat, said he was exploring tax proposals that would make the refineries more attractive to prospective buyers without detailing the plan.

Senator Bob Casey, a Pennsylvania Democrat, said the companies needed to be “more transparent” about their efforts to sell the facilities.

The companies should “make every effort” to find buyers, he said. Casey, who has requested the Senate Energy and Natural Resources Committee hold hearings on the shutdowns, said he wasn’t aware of any possible legislative fix.

The steelworkers union, based in Pittsburgh, said the plants have more than 2,000 workers.

“We understand our decision to idle and seek a buyer for the Trainer refinery has had a significant impact on our employees, their families and local communities,” Rich Johnson, a spokesman for Houston-based ConocoPhillips, said in an e- mailed statement today. “We are making every effort possible to find a buyer for the refinery.”

Trainer Closing

ConocoPhillips plans to spin off its refining business this year, and said in October that Trainer was idled and would permanently close by the end of the first quarter if a buyer had not emerged. Johnson said in a telephone interview today that ConocoPhillips hasn’t decided what would happen to the Trainer facility if it closes.

Sunoco is working to exit refining after more than a century of processing oil into fuel so it can focus on its more profitable pipeline and retail sales businesses. On Feb. 2, Sunoco said it had received some interest from potential buyers for its Philadelphia refinery, while not “a single proposal” for the purchase of Marcus Hook as an operating refinery.

If no agreement is reached, Sunoco said it plans to idle by July the main processing units at Philadelphia. Sunoco said it’s pursuing alternatives for Marcus Hook and doesn’t believe it will be bought and restarted as an operating refinery.

--With assistance from Bradley Olson in Houston and Jon Morgan in Washington. Editors: Jon Morgan, Susan Warren

To contact the reporters on this story: Jim Snyder in Washington at jsnyder24@bloomberg.net; Edward Klump in Houston at eklump@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net


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