|
British Columbia Chevron refinery up for sale
GARY PARK For Petroleum News
Chevron is testing the market for interest in its small Vancouver-area refinery, which supplies about a quarter of British Columbia’s refined fuel, along with its chain of 138 service stations and 41 Chevron-branded outlets.
That comes only three months after Imperial Oil sold 497 Esso gas stations for C$2.8 billion, with 7-Eleven acquiring 148 of them in British Columbia and Alberta.
A Reuters report earlier in June said Suncor Energy is also weighing the auction of its Petro-Canada lubricants division on Ontario, an asset that is estimated to carry a price tag of C$800 million, although Suncor said only that it is looking to divest some non oil producing assets.
Chevron’s refinery in Burnaby, which has capacity to process 55,000 barrels per day of crude, opened 81 years ago under the Standard Oil banner at 2,000 bpd, before expanding and modernizing.
A Chevron spokesman said there have been approaches in the past by those interested in the company’s refinery and distribution network.
He said that triggered Chevron’s decision to invite bids “to test the broader market value.”
“We are open to changing market conditions and this expression-of-interest process allows us” to take the next step.
The spokesman said no deadlines have been set to complete a sale beyond indicating that “these processes can be lengthy.” Analysts have yet to put an estimate on possible sale proceeds.
Storage facilities sold In the spring Chevron sold two gas storage facilities in British Columbia to Fortis for US$266 million as part of an effort to streamline its portfolio and generate C$5 billion to C$10 billion from assets sales over the next two years.
Two years ago Chevron said in a conference call with analysts that its smaller refineries, including the Burnaby plant, are among its most profitable facilities.
The timing is viewed as interesting, given that the Canadian government is only months away from deciding whether or not to approve Kinder Morgan’s plans to triple capacity on its Trans Mountain pipeline from the Alberta oil sands to a tanker terminal adjacent to the refinery, whose feedstock to process 300,000 bpd of crude already comes from Alberta.
Currently an estimated 50,000 bpd of capacity on Trans Mountain is destined for export to markets in Asia and elsewhere.
| 