July 6, 2012:

NuStar Energy, L.P. announced plans on Friday to sell half of its asphalt operations to Lindsay Goldberg for millions to create a joint venture. The transaction is expected to be complete by the end of September. NuStar, based in San Antonio, is a publicly traded, limited partnership that employs 130 South Jersey residents in its Paulsboro Refinery, the Paulsboro Terminal, and the East Region and Refining Division Office in West Deptford Township. “Primarily, everything will look the same for us,” said Claire Riggs, Senior Regional Public Affairs Manager for the refining division. “We look to continue to enjoy being part of the NuStar family. This will be a good move for business.” As a result of the deal, NuStar expects to reduce earnings volatility and allow for debt reduction and high-return investments, according to the company. “This joint venture transaction allows NuStar to monetize a portion of its asphalt operations and still maintain a 50 percent interest in a business that has the potential to generate significant cash flow as the U.S. economy improves,” said NuStar President and CEO Curt Anastasio.

Anastasio said NuStar’s Pauslboro refinery, along with its Savannah, Ga., refinery, and all related inventory will be transferred into the joint venture. “This transaction will allow both the L.P. and the new Asphalt J.V. to flourish,” said Anastasio in a press release. “Importantly, the transaction will allow NuStar to reduce its earnings volatility, reduce debt and will provide additional opportunities to invest in stable, high-return, pipeline and terminal assets while simultaneously giving the Asphalt J.V. the flexibility it needs to prosper in a more robust margin environment.” Proceeds from the sale are expected to total $175 million, paid by Lindsay Goldberg to NuStar.

NuStar Energy is one of the largest asphalt refiners and marketers in the country and is the second largest independent liquids terminal operator in the nation.

By nj.com

July 6, 2012:

A Wall Street Journal report said that an official at Iranian oil and gas contractor Tadbir Energy Development Group had confirmed that the company had sent a letter outlining its intention to bid for the Petit-Couronne refinery, which serves the Paris area and refines about 10% of France's fuel requirements. "We sent a letter…to buy Petit-Couronne," the official said. The person familiar with the matter confirmed Wednesday that this bid had been submitted. Tadbir should be allowed to make the bid because it isn't sanctioned by any foreign government. It is controlled by the Imam Khomeini Foundation, one of Iran's largest charitable groups. Tadbir is one of several parties that have declared interest in the refinery. Unlike other declared contenders, such as Geneva-based Klesch & Co. SA, Tadbir does have industrial experience in the refining sector.

Tadbir is already a refiner in Iran and wants to expand abroad, said the person familiar with the matter. It sees current oil sanctions against Iran, which would prevent it from running Iranian crude through the refinery, as temporary, the person said. In the short term, the person said Tadbir had devised ways to finance any investment without transferring funds from Iran. It could use a processing contract-whereby an owner leases a refinery to a third-party which buys feedstock and sells it on the market-to run the plant, the person said. Such a contract is already in place at Petit-Couronne, where Royal Dutch Shell RDSA -0.31% PLC is supplying crude on a temporary basis.

The Petit-Couronne plant refines 161,800 barrels a day of oil and supplies the country's most important region, the greater Paris area. But it is threatened with closure after its owner, Swiss refiner Petroplus Holding AG, was placed into administration. The refinery's bankruptcy administrator and France's ministry for industrial revival-which oversees the refining sector-declined to comment. Petroplus didn't return a request for comment. Newly elected French president François Hollande vowed during his campaign to keep the refinery afloat, which could save 500 jobs. Paris, under the previous president, Nicolas Sarkozy, has been at the forefront of a push to sanction Iran over its nuclear program, but Hollande has ruled out Sarkozy's costly warmongering policies, showing that he is more fond of talks and diplomacy to find some room for his country's internal problems.

By equities.com

July 6, 2012:

For a region that faced the threat of having the heart ripped out of its oil industry with the closure of two Delaware River refineries, it was good to hear that Sunoco Inc.'s Philadelphia refinery will keep pumping. Beyond saving 850 jobs at the refinery, the new operator — the Washington-based private-equity firm Carlyle Group — hopes to add another 200 jobs as it modernizes and expands the sprawling facility in South Philadelphia. At the same time, workers continued returning to the former ConocoPhillips refinery in Delaware County, where they will retool the refinery to produce jet fuel for a subsidiary of Delta Air Lines. Monroe Energy L.L.C. plans to begin production in the fall, enabling Delta to trim its annual fuel bill by about $300 million.

Only Sunoco's smaller refinery in Marcus Hook remains idle, shuttered by the company as Sunoco moves away from refining as part of its merger with a Texas pipeline company, Energy Transfer Partners L.P. of Dallas. But Delaware County officials are clinging to some hope, in the form of a study that suggests the site could be reborn as a multipurpose energy processing facility linked to natural-gas production from the state's booming Marcellus Shale drilling fields. Despite uncertainty in Marcus Hook, the announcement Monday that Sunoco's city refinery would remain in operation means the region's oil-industry prospects are the equivalent of a barrel that's more half full. It's a success story that casts a private-equity firm in what may be viewed as the unlikely role of saving jobs, rather than slashing them for quick profits. But Carlyle has proven to stand apart from the pack with its industrial investments, in keeping with what spokesman David Marchick characterizes as the company's confidence in U.S. manufacturing.

Carlyle's move, though, was aided by an important course change at Sunoco that was in part prompted by a White House appeal. Recently elevated CEO Brian P. MacDonald made the key decision to retain a one-third nonoperating interest in the refinery, rather than a complete sell-off. That, along with $25 million in state grants from an enthusiastic Gov. Corbett for Carlyle's planned upgrades, made the deal work. In the cheering section were United Steelworkers members, who rallied local elected officials. As in so many situations with union jobs at stake, U.S. Rep. Bob Brady (D., Pa.) also took a central role in bringing players to the table, with Mayor Nutter adding his clout. It's often questionable whether state aid and other incentives worth millions should be handed out to lure jobs that ultimately fall short of giving taxpayers a good return on their investment.

But the Corbett administration — which has offered a multiyear tax break to Shell Chemical L.P. in hopes of bringing a multibillion-dollar petrochemical plant to Western Pennsylvania — figures that the Sunoco facility will support 10,000 jobs indirectly.  Even if the governor's calculation falls short, with warnings from federal energy officials that closing the refinery could have prompted fuel shortages and price spikes across the Northeast, consumers have reason to celebrate the Sunoco deal.

By Philly.com

July 6, 2012:

Thailand's Bangchak Petroleum Pcl is seeking diesel in a rare import tender, after a fire forced its refinery in central Bangkok to shut down, industry sources said on Friday. The refiner is seeking two cargoes of about 10,000 tonnes each of 50 ppm sulphur diesel for delivery into Bangkok over July 15-17 and July 18-20. The tender closes on July 9. Bangchak usually exports diesel in small volumes to countries including Cambodia and the Philippines, rarely importing the product because Thailand is a net exporter of diesel, traders said. The company has shut its 120,000 barrels per day (bpd) plant for one week as a fire that broke out on Wednesday damaged a crude distillation unit (CDU). The damaged unit, with a capacity of 80,000 bpd, will remain shut for at least 30 days for investigation, while the smaller 40,000 bpd unit and a hydrocracker unit will be restarted after a week. The shutdown of the bigger CDU may extend to two months.

Bangchak's latest tender is likely to have been issued to enable the company to continue supplying its retail network in the country. Cargo sizes for the tender are small due to jetty and draft restrictions, a Singapore-based trader said. It is unclear if Bangchak will have more diesel requirements, but if it does, volumes are likely to be small due to lower demand in the monsoon season, traders said. The fuel is used by farmers to run tractors and water pumps to irrigate fields. The tender also comes at a time when diesel supply in Asia has been tight due to Australian demand and refinery maintenance in Singapore. BP and Shell have been actively seeking low sulphur diesel cargoes in the spot market ahead of the permanent closure of Shell's 79,000-barrel-per-day Clyde refinery in Australia on Sept. 30.

By Reuters

July 6, 2012:

Showa Shell Sekiyu KK, Japan's fifth-largest refiner, said on Friday it expects to refine 17 percent less crude oil in total for domestic consumption and exports in the July-September quarter than a year earlier. The drop to 7.1 million kilolitres (485,400 barrels per day) reflects the closure of its subsidiary's Ohgimachi factory in September last year and the scheduled maintenance at Seibu Oil's 120,000 bpd Yamaguchi refinery in western Japan for about a month this September, a company spokesman said. Toa Oil, in which Showa Shell has 50.1 percent, permanently shut the Ohgimachi factory, including a 120,000 bpd No.5 crude distillation unit (CDU), at the two-factory Keihin refinery on Sept. 20. Showa Shell has a 38 percent share in Seibu Oil. Showa Shell sees its refining for the domestic market at 6.94 million kilolitres (474,500 bpd), down 7 percent from the third quarter last year.

In Japan, the world's third-biggest oil consumer, oil demand is on a downward trend, except for one-off effects from reconstruction and the need from utilities to burn oil to make up the loss of nuclear power amid safety concerns after last year's earthquake and tsunami triggered a nuclear disaster.  Showa Shell, which is 35 percent owned by Royal Dutch Shell and nearly 15 percent owned by Saudi Aramco, refines crude at its four group refineries in Japan with total refining capacity of 538,000 barrels per day. Crude will be processed at the 210,000 bpd Yokkaichi refinery, Toa Oil's 65,000 bpd Keihin refinery and Fuji Oil's 143,000 bpd Sodegaura refinery. Showa Shell has 6.6 percent of Fuji Oil's parent, AOC Holdings.

By Reuters