Monday, June 04, 2007

Tesoro Stepping Up In California Gasoline Market

Tesoro ponied up $1.75 billion for Shell’s Wilmington refinery and various other Southern California assets, and it has plans to spend another $1 billion on upgrades to the facility over the next five years.

The company has also said that the facility will no longer produce gasoline for Nevada and Arizona, rather it will focus exclusively on making the special California blend of gasoline that is required by state environmental laws.

This should all add up to increased supply at a time when it is badly needed.

Even the activist community which makes a living bashing the “oil industry” was hard pressed to find something to criticize about this move.

The Foundation for Taxpayer and Consumer Rights, which nodded its approval in a comment made to the Los Angeles Times, was clearly uncomfortable with saying anything complimentary about any company even remotely connected to the manufacture or distribution of petroleum products, still managed to take a shot at the industry:

"We need more gas on the market," said Jamie Court, president of the Foundation for Taxpayer and Consumer Rights, whose Santa Monica-based group is a frequent critic of the oil industry. "Putting refineries into the hands of a Tesoro or a Flying J is a good thing, because they are much more likely to expand refining than the majors."

High praise indeed…

Tesoro to pump funds into refinery [Los Angeles Times]