Tag Archives: refinery

America’s largest new refinery since 1977 may be built in South Texas (Eagle Ford)

A Houston company is looking to pump $500 million into South Texas to create the largest new refinery in the U.S. in nearly 40 years.The facility — located in the southwest corner of Duval County off of Texas Highway 359 — will be able to process up to 50,000 barrels of Eagle Ford shale light crude oil a day, and will have up to 4 million barrels of available storage, the company said in a news release.

Source: South Texas to get America’s largest new refinery since ‘77 – San Antonio Express-News

Fire at LyondellBasell refinery in Houston: sources | Reuters

A fire ignited Friday morning at LyondellBasell Industries’ 263,776 barrels-per-day refinery in Houston, sources at the plant told Reuters.Details were unavailable, though a huge plume of smoke blanketed east Houston. On Thursday a hydrogen compressor malfunction shut a gas oil hydrotreater at the plant.

Source: Fire at LyondellBasell refinery in Houston: sources | Reuters

Energy Companies to Merge in $15.8 Billion Deal – NASDAQ.com

A partnership controlled by Marathon Petroleum Corp., a refinery and pipeline company, will buy MarkWest Energy Partners LP for $15.8 billion in one of the biggest oil-patch deals since crude prices began to slump last summer.

The deal will marry Marathon’s oil pipeline network with MarkWest’s business separating natural gas into fuels such as propane and ethane.

The combined company would have a market capitalization of $21 billion, making it the fourth-largest master limited partnership. These partnerships, which typically own infrastructure like pipelines that earn steady revenue from long- term contracts, have fared better than traditional drilling companies during the energy downturn but still have faced headwinds.

Shares of MPLX closed 15% lower to $59, while shares of MarkWest rose nearly 14% to $68. Shares of Marathon Petroleum Corp. rose 7.9%.

The deal is the latest consolidation between energy partnerships, which don’t pay corporate income taxes but distribute their available cash to shareholders. The need to keep these hefty payouts growing means the partnerships are always looking to expand.

Gary R. Heminger, Marathon’s chief executive, said the deal would allow the partnership to boost its annual distribution by 25% through 2017.

“The combination significantly increases our size, scale and the opportunity to grow over a very long period of time,” Mr. Heminger told analysts during a conference call on Monday.

Refiners have been among the newest energy companies to form these partnerships. Marathon Petroleum, of Findlay, Ohio, owns refineries in Texas, Louisiana, and throughout the Midwest. It launched MPLX in 2012 to own and operate pipelines and other fuel transportation assets.

But recently, refiner-backed partnerships have started to branch out beyond their parent companies—and beyond oil. Last year, a partnership controlled by Tesoro Corp., the refiner based in San Antonio, bought a natural gas gathering and processing company for $2.5 billion.

Executives from Marathon and MarkWest said Monday that they began to explore the idea of combining after the two companies worked together on projects in the Northeast, where fuels known as natural gas liquids are commonly produced along with gas in the shale fields of Ohio and Pennsylvania.

The combination illustrates that region’s allure, even as a glut of oil and gas has sent prices for these fuels plummeting in recent months and sparked concern that production could slow down. MarkWest is one of the largest natural- gas processors in the U.S., with a particularly large presence in the Northeast.

As oil prices continue to languish, diversifying into other fuels like natural gas and liquids including propane and ethane becomes more attractive, said Brandon Blossman, a managing director at Tudor Pickering Holt & Co., an energy investment bank based in Houston.

“Low oil prices and the implication that oil volume growth slows or stops has put pressure on the oil-focused midstream players think about diversification towards gas,” he said.

via Energy Companies to Merge in $15.8 Billion Deal – NASDAQ.com.