The prospects for keeping three US Northeast refineries running are brighter than owners Sunoco or ConocoPhillips have let on, members of Congress' Pennsylvania and Delaware delegations said Wednesday.
"I have personally met with the senior executives of the refiners and the senior executives of potential buyers," Senator Pat Toomey, Republican-Pennsylvania, told union workers who have been laid off or face pink slips within months. "I do think there are some real prospects. It's not going to be easy, and I can't guarantee an outcome."
Representative Bob Brady, Democrat-Pennsylvania, said he has recently met with four potential buyers, but declined to give any details about their identities, which plants they were interested in and whether they wanted to buy them whole or piecemeal.
"We have many buyers; don't be fooled," Brady said, while acknowledging that it was the "11th hour and 59th minute" to keep the plants open.
Lawmakers added that they would pursue a national security angle while trying to draw attention on Capitol Hill to the region's loss of half its refining capacity. Slated for sale or closure because of sustained weak margins are: Sunoco's 330,000 b/d Philadelphia and 175,000 b/d Marcus Hook, Pennsylvania, refineries, and ConocoPhillips' 185,000 b/d Trainer, Pennsylvania, refinery.
Representative Patrick Meehan, Republican-Pennsylvania, said the chairman of the House Committee on Homeland Security approved his pitch for a hearing to examine the closures, with possible testimony by the companies.
"When you shut down these refineries in our backyard, you're going to be losing 50% of the refining capacity for the Northeast," he said. "What's going to happen in one night if something happens -- Philadelphia to New York to New England? What are the implications of this?"
Meehan said industry's reassurances about getting backup supplies by tanker or from the Colonial Pipeline during emergencies fall flat.
"The last time I looked, that pipeline was about as full as it could be," he said. "And what happens if something happens to that pipeline? What happens if something occurs to the infrastructure in this country?"
United Steelworkers Vice President Gary Beavers said he has met with "several financiers" who have expressed interest, and he hopes the political pressure will influence the sellers to act on realistic offers.
"I'm convinced that something's going to happen and we're going to be able to help some of you at least -- I hope all of you," he told the few hundred union workers. "But I can't believe that somebody can walk away from three refineries saying there's no profit there."
While Senator Bob Casey, Democrat-Pennsylvania, does not see a legislative fix, he said congressional hearings could pressure the companies to make the sales process more transparent.
"Sunoco especially needs to provide more information to the workforce and to the public," he said. "They need to be making every effort to get buyers. If they're not making progress, they should tell us that."
Sunoco said on February 2 that it has contacted more than 150 potential buyers in all segments of the industry, receiving "some degree of interest" in the Philadelphia refinery. About 900 people remain on the job, but the company said it would shut the plant if it does not find a buyer by July.
"Sunoco has not received a single proposal for the purchase of Marcus Hook as an operating refinery, but is continuing to pursue alternatives for the facility," the company said. "At this time, Sunoco does not believe that Marcus Hook will be purchased and re-started as an operating refinery."
Sunoco idled Marcus Hook in December, and its 600 employees expect layoffs to start February 29, said Dave Miller, president of the local union.
ConocoPhillips idled its Trainer facility in September and announced a March 31 deadline to find a buyer.
The Energy Information Administration said in December that the shutdowns would likely cause supply problems across the region that could create price volatility.
In 2010, the three refineries produced a total of 315,000 b/d of gasoline, 194,000 b/d of distillate and 41,000 b/d of jet fuel, EIA said. Distillate volumes included 143,000 b/d of ULSD, mainly for on-road use, and 51,000 b/d of higher-sulfur distillate, sold primarily as heating oil.
