Valero to convert idled Aruba refinery to terminal

Valero has decided to further reduce operations and reorganize its 235,000 bpd Aruba refinery as a refined products terminal, the company said on Monday.

“We believe that Aruba has the assets to compete as a world-scale crude and refined products terminal,” said Valero CEO Bill Klesse. “With both deepwater berths and smaller berths, the terminal will have the flexibility to load the very largest crude ships.

“In addition, the scale and mixture of tankage will permit commercially attractive storage opportunities for our customers. Aruba’s proximity to growing markets and its business-friendly political environment make it an ideal location for our new terminal operations.”

Terminal activities will, however, require a considerably smaller workforce, according to the company. The reorganization and reduction in workforce is expected to be complete before the end of 2012.

Valero will continue to supply jet fuel, gasoline, diesel, and fuel oil to the island, as well as engage in third-party terminal services.

In the terminal operations mode, Valero will continue to invest in Aruba with facility improvements and dock and tankage upgrades, the company said.

Valero human resources representatives will begin meeting with refinery employees this week to explain the staffing selection for the terminal operations.

Valero suspended refining operations at the refinery in March and maintained the refinery in a state that would allow a restart, keeping its employees on payroll pending this decision.

In the near-term, the refinery will continue to be maintained in a state that would allow a restart, should Valero be successful in the pursuit of alternatives for the refinery prior to the terminal transition.

“We will continue to work with Prime Minister Eman and his government in this effort,” Klesse said. "Our discussions with interested parties, including those facilitated by the Government of Aruba, will continue, and if successful may result in the suspension of the workforce reduction.”

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