BP sell Texas City refinery $2.5 billion

BP to sell Texas City refinery for $2.5 billion

5:13 AM, 9th October 2012
BP to sell Texas City refinery for $2.5 billion
Iain Conn, Chief Executive, Global Refining and Marketing, BP.

LONDON, UNITED KINGDOM: BP will sell its Texas City, Texas refinery and a portion of its retail and logistics network in the Southeast US to Marathon Petroleum Corporation for $2.5 billion. BP anticipates the transaction will close by early 2013. With this agreement the total value of the divestments that BP has agreed since the beginning of 2010 is now over $35 billion. BP expects this total to reach $38 billion by the end of 2013.

“Today’s announcement is the second major milestone in the strategic refocusing of our US fuels business. Our divestments will allow us to focus BP’s US fuels investments on our three northern refineries, which are crude feedstock advantaged, and their associated marketing businesses,” said Iain Conn, Chief Executive, Global Refining and Marketing, BP.

Subject to regulatory approvals, Marathon Petroleum will purchase the 475,000 barrel per day refinery, associated natural gas liquids pipelines, and four marketing terminals in the Southeast US. BP will also assign certain branded jobber contracts supplying approximately 1,200 retail sites in Tennessee, Mississippi, Alabama and Florida which could be supplied by the refinery. BP will remain a significant retailer of fuels in the US, with approximately 8,000 BP and ARCO-branded sites in the Midwest, Pacific Northwest and along the East Coast.

“In recent months the Texas City refinery has returned to profitability. It does not, however, fit with the long-term strategic direction of BP’s global refining portfolio,” said Keith Casey, Manager, Texas City refinery.

BP continues to invest in its three Northern US refineries. The company is in the midst of a multi-billion dollar modernization effort at its Whiting Refinery in Northwest Indiana. The BP Cherry Point Refinery in the state of Washington is being upgraded to produce cleaner-burning diesel fuel and the BP Husky joint venture near Toledo, Ohio is investing to improve its gasoline making capabilities.

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