Posted on 04/09/2004 10:43:56 PM PDT by NormsRevenge
Demands that the Shell Bakersfield Refinery remain open intensified Friday, as Sen. Barbara Boxer joined a chorus of calls to the Federal Trade Commission and California Attorney General Bill Lockyer to prevent the closure. "The plant must remain open until a buyer is found and a sale is completed. Otherwise, consumers will pay the prices," Boxer wrote in a letter to FTC Chairman Timothy Muris.
Boxer's letter caps a week that has seen a wide array of critics of the proposed closure emerge. Also this week, the FTC announced it is evaluating the situation, and the state Attorney General's office -- albeit falling short of a demand that the refinery not close -- said it will do everything in its power to keep prices under control.
Industry experts have said the refinery's closure will likely result in higher gasoline and diesel prices on the West Coast, as well as the loss of 250 full-time jobs and an additional 150 contractors.
A chink in Shell's insistence that it will demolish the plant also appeared this week. Although Shell insisted no buyer would want the plant when it announced in November it would shutter it and tear it down, Lynn Elsenhans, president of Shell Oil Products U.S., said Tuesday that it is for sale.
"Since so many people have questioned if the refinery is for sale, I want to make it clear that it is, and to state unequivocally that we are willing to sit down with any credible buyers to discuss such a deal," he said in a statement.
"I urge you to do more than merely welcome discussions," Boxer wrote Elsenhans on Friday. "I urge you to actively seek a purchaser for the Bakersfield refinery."
The logical buyer for the Bakersfield refinery would be ChevronTexaco, which runs the adjacent Kern River oil field. The refinery grew up sipping Kern River heavy crude, and was owned over the years by successive companies with major holdings in Kern River.
The last of those was Texaco, which merged its West Coast refining and marketing operations with Shell's in the late 1990s.
When Texaco was bought by Chevron in 2001, the state Attorney General's office forced the merged company to sell off its interests in its jointly held refineries, including the Bakersfield plant.
That means ChevronTexaco can't buy the refinery unless a modification of the deal it negotiated with the attorney general is reached.
After the merger, ChevronTexaco also ended up with virtually the entire Kern River oil field.
Asked Friday, ChevronTexaco spokesman Ed Spaulding said the company already owns two large California refineries, one in Los Angeles and the other in the Bay area, and likely didn't need the Bakersfield plant.
Boxer urged Elsenhans to postpone the refinery's closure and demolition to allow time for a buyer to be found. That's not likely, a Shell spokesman said.
"Our decision is still to close the refinery on Sept. 30," spokesman Cameron Smyth responded.
Sen. Dianne Feinstein will join her fellow Democrat and send a similar letter to Shell next week, Feinstein's office said.
Shell officials have repeatedly said they are closing the Rosedale Highway refinery because of declining supplies of heavy crude oil in the San Joaquin Valley.
The Shell refinery is one of 13 refineries in the state, three of which the company owns.
The refinery also produces 7 percent of the state's diesel supply.
Boxer said that leads her to believe "there's some desire here to lessen the supply. And having gone through the electricity crisis in California, where manipulation of supply is what caused our crisis, I'm bound and determined to to do everything I can not to allow 2 percent of the (gasoline) supply to disappear because Shell will do better if there's less supply."
Smyth said any suggestion that Shell is closing the refinery to drive up prices or restrict supply is not true.
In her letter to FTC Chairman Muris, Boxer said she was joining Sen. Ron Wyden of Oregon in asking the commission to re-examine recent mergers in the gasoline industry in order to determine if the refinery's closure has anti-competitive implications.
Wyden sent Muris a letter in February and another in March.
Muris responded on Tuesday.
"The issues that you have raised are very important to this agency and will be seriously considered as the agency evaluates the situation with respect to the Bakersfield refinery and determines what course of action, if any, may be warranted."
"I urge you to use all legal courses of action to block closure of the refinery," Boxer wrote Lockyer.
A spokesman for Lockyer said the attorney general is doing just that.
Earlier this week, a consumer rights group based in Los Angeles called on Lockyer to force Shell to keep the refinery open or sell the plant.
I understand, but there are more chemicals than MTBE. Many others are used to "crack" petroleum into gasoline and other usable products. The structure of an old refinery itself, is hazardous waste.
witch
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