May 8, 2012:

Now that ConocoPhillips has agreed to sell its Trainer refinery to Delta Air Lines, and Sunoco Inc. is engaged in talks to run its Philadelphia refinery as a joint venture, the immediate fate of only one of the region’s endangered refineries remains clouded in uncertainty.

Sunoco’s Marcus Hook refinery, which company officials say aroused no interest from potential buyers to run as a refinery, is being groomed instead as a potential multipurpose industrial site for storing, handling, and even processing fuel, including by-products from the Marcellus Shale region. The Delaware County Industrial Development Authority this month is expected to complete a fast-track study to explore possible uses for the site, said J. Patrick Killian, director of the county Commerce Center. Sunoco idled the refinery in December, citing mounting losses and diminished markets for refined products.

“Everybody’s preference was to keep it as a refinery,” Killian said. Now the focus of officials is to encourage new businesses to inhabit the site — which occupies more than one square mile on the Delaware River waterfront — with the aim of replacing most of the refinery’s 590 lost jobs. “A year from now, you could have seven or eight industries over there,” Killian said.

The 781-acre Marcus Hook site, which Sunoco operated for more than a century, includes port facilities, vast fuel-storage capacity, and pipeline connections that would make it attractive as a fuel terminal. It also has a unique feature: five underground storage compartments carved out of the bedrock in the late 1950s known as “the caverns” that can hold two million barrels of pressurized liquid fuels such as butane or petrochemicals. But a fuel terminal would employ only a fraction of the refinery’s workforce.

Sunoco’s merger with Energy Transfer Partners L.P. of Dallas, announced last week, also may present some new opportunities for repurposing the Marcus Hook property, said Brian MacDonald, Sunoco’s chief executive officer. ETP is primarily a pipeline company, and one of the attractions of Sunoco was getting control of Sunoco Logistics Partners L.P., which operates its own network of pipelines built initially to handle Sunoco’s crude oil and refined products.

By Philly.com