"California legislators are considering giving Valero Energy Corp. hundreds of millions of dollars to cover refinery maintenance costs in a bid to prevent the closure of a San Francisco-area fuel plant. Under such a deal, the state would pay Valero to continue operating its Benicia refinery, according to people familiar with the negotiations who asked not to be identified discussing private deliberations. The plant is slated to close by April, the latest in a string of recent California fuel-plant shutdowns."
"Between $80 million and $200 million of state funds would likely be earmarked for routine maintenance work, although the terms of the arrangement could be subject to change, the people said. Maintenance is one of the biggest operating costs for refiners and the expense of major overhauls typically performed every four or five years can be a catalyst for closure. Discussions with lawmakers over keeping the Valero facility open were held as recently as this past weekend."
State legislators are negotiating a plan to pay Valero Energy Corp. to continue operating the Benicia refinery, potentially allocating between $80 million and $200 million for routine maintenance. The refinery is scheduled to close by April amid a wave of California fuel-plant shutdowns, and maintenance costs and periodic major overhauls can prompt closures. Negotiations occurred recently and lawmakers face a near-term deadline to submit bills. Governor Gavin Newsom has encouraged regulators to collaborate with refiners to maintain fuel supplies, and the California Energy Commission rescinded plans for a profit cap. Benicia faces a $10 million municipal budget shortfall if the plant closes.
Read at www.mercurynews.com
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