John A. Catsimatidis, chief executive and chairman of United Refining Energy Corp. has said his company is considering making an offer for Sunoco Inc.’s Philadelphia refinery, which is set to be shut down 1 July 2012, if a buyer is not found.
The refinery is the largest on the east coast with a 335,000bpd capacity, covering about 1,400acres and employing about 850 workers. It is one of three refineries in a 12-mile radius deemed unprofitable by their owners and threatened with permanent closure. Sunoco shut down operation at its Marcus Hook refinery in 2011 and ConocoPhillips has shut down operations and recently pushed back the deadline for permanently idling its Trainer refinery until the end of May. Catsimatidis is the first potential buyer to have publicly acknowledged an interest in the Philadelphia refinery.
Though Pennsylvania secretary of community and economic development, C. Alan Walker has said that he is confident that two of the three refineries would find buyers, the Energy Information Administration has said that should all three plants shut down, the region’s refinery capacity will be cut in half, leaving the Northeast vulnerable to supply disruptions.
Catsimatadis, a billionaire whose holdings include the Gristede’s Foods grocery chain in New York, owns all the voting shares of United Refining, which operates a 70,000bpd refinery on the Allegheny River in Warren, PA, processing Canadian crude oil delivered by pipeline.
Sunoco announced plans in September 2011 to concentrate solely on retail marketing and logistics and get out of refining, after refineries lost US1 billion over the past three years.