Shell to sell Bakersfield refinery to Flying J subsidiary

The Associated Press

Shell Oil Corp. has agreed to sell its Bakersfield refinery to a subsidiary of Flying J Inc., a privately held oil company based in Ogden, Utah, the company said Jan. 10.

Terms of the sale were not disclosed. Shell said the transaction should close by March 31.

Closing the deal will be contingent upon both companies agreeing with federal authorities, including the Environmental Protection Agency, about transferring obligations under a consent decree governing the refinery’s operation.

Shell said Flying J wants to “retain a large portion of the work force” and will honor the refinery’s existing collective bargaining agreement. Workers wanting to stay will have the chance to discuss job opportunities with Flying J officials.

Refinery employs 210 full-time workers, plus 150 contractors

“We’re pleased to reach this sale agreement, which we recognize is important to many people in Bakersfield and beyond,” Lynn Laverty Elsenhans, president of Shell Oil California, said in a statement.

Last month, Shell said it would keep the refinery open for another three months after the federal government agreed to let it exceed pollution standards.

Shell had planned to close the refinery this fall on grounds that it was old and inefficient and that crude oil from the Kern County fields was drying up. In July, Shell spokesman Stan Mays said the refinery had lost $50 million over the last three years.

Lawmakers praise sale

Those lawmakers praised the Jan. 10 announcement.

“While we have to study the details of the sale, the continued operation of Shell’s Bakersfield refinery would be a victory for California drivers,” state Attorney General Bill Lockyer said in a statement.

U.S. Sen. Diane Feinstein, D-Calif., said the deal was important because the refinery produces at least 2 percent of California’s gasoline and diesel fuel.