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Valero Oil Company Ownership

To fill this gap, Valero is among the U.S. refineries rushing to source from Ecuador, according to the Fortune report. The head of oil trading at Ecuador`s state-owned oil company EP Petroeducador told the publication that he had held consecutive meetings with several refineries and trading houses. He said Valero was looking for a supply contract. On July 31, 2012, during the Q2 earnings conference call, Valero announced its intention to separate the retail business from the rest of the business. Mike Ciskowski, Chief Financial Officer, said: «We believe that separating our retail business through a tax-efficient distribution to our shareholders will create operational flexibility within the business and create value for our shareholders. [45] In 2013, Valero completed the spin-off of the retail business under the name CST Brands. [15] Valero no longer owns retail stores under the names Diamond Shamrock, Shamrock, Beacon, Ultramar or Texaco, but Valero continues to supply fuel. [16] On the supply side, Valero noted that Resid`s prices had fallen as inventories had increased and the company had undertaken to modernize its refinery and increase capacity. In order to ensure a stable supply of raw materials in the future, the company sought to take over a foreign oil producer as co-owner of the refinery. Valero ended 1988 with a profit of $30.6 million. Last year, Valero imported nearly 122.9 million barrels of crude oil, according to the U.S.

Energy Information Administration. Russia was the company`s third-largest importer after Mexico and Iraq. Valero`s strategy of basing its products largely on acid crude sold at a significant discount to sweet crude – the discount averaged more than $11 per barrel in 2004 – paid off in 2003 and 2004. After making a profit of $622 million last year on revenue of $37.97 billion, Valero nearly tripled its profit a year later, scoring $1.8 billion on revenue of $54.62 billion. Until 2004, the company processed two million barrels of crude oil into 40 million gallons of gasoline each day, which was 10 percent of U.S. supply. While many skeptics believed the oil industry`s next collapse was imminent, Greehey remained fairly optimistic, saying the conditions that caused the boom — high crude prices, growing demand for refined products, and refinery utilization at or near capacity — were likely to continue. He told the San Antonio Express News in July 2004, «I think at least for the next four or five years, refining will be absolutely the best deal.» To underscore this belief and catapult it to the forefront of domestic crude oil refining, the company signed an agreement in May 2005 to acquire Premcor Inc.

by the end of the year for $3.4 billion in cash and $3.5 billion in stock. Valero is expected to make further refinery acquisitions in the coming years and increase the capacity of a number of its existing refineries. With money from the sale of its gas assets, Valero was able to reduce its dangerously crippling debt burden by more than $700 million and make its balance sheet relatively healthy. However, this meant that the heart of the company was its loss-making refinery. Valero lost $13.3 million in the first six months of 1987 as a result of its gasoline refining and marketing activities. The company had another pivotal year in 2005. Valero became the largest and most geographically diversified refinery in North America with the acquisition of Premcor Inc. in an $8 billion transaction. In 2011, the company expanded its geographic presence with the purchase of the Pembroke refinery in Wales, which marked its entry into Western Europe. In addition, the company expected that by 1994, all gasoline production would consist of reformulated gasoline. The start of the Allied offensive in the Persian Gulf in early 1991 immediately brought oil prices down. However, in anticipation of this effect, Valero had sold much of its production in advance at inflated prices in the first quarter, increasing its balance sheet by $30 million.

Although Valero lost money when it was forced to halt some of its production to make improvements to its plant, the company ended 1991 with a record profit of $98.7 million. Currently, the company has 15 refineries in the United States, Canada and the United Kingdom. with a throughput capacity of 3.2 million barrels per day. This makes it the largest independent refinery in the world. It is also the largest producer of renewable fuels in the United States, with Diamond Green Diesel producing 275 million gallons of renewable diesel annually. Valero supplies nearly 7,000 independent fuel outlets in the United States, Canada, the United Kingdom, Ireland and Mexico. In late 1996, Valero officially announced its intention to split the company to focus exclusively on oil refining and marketing. In mid-1998, Valero completed a transaction in which it sold its natural gas business to PG&E Corporation for $720 million in stock and $780 million in debt. The transaction was structured in such a way that Valero`s oil refining and marketing unit was first sold to existing shareholders prior to the closing of the PG&E transaction.

This spin-off entity retained the name Valero Energy Corporation, and the former Valero Energy was later merged with PG&E. The $1.5 billion Valero earned was immediately used to launch a massive multi-year acquisition tour that would catapult the company into one of the largest refineries in the United States. Thus, upon its birth, Valero became the largest national pipeline in Texas, with 8,000 miles of transmission lines, $700 million in assets, and start-up revenues of more than $1 billion. In addition, Valero had the right to charge customers ten cents per million cubic feet (mcf) through its gas costs in the first year and 15 cents through mcf in the second year, guaranteeing the company a profit of at least $23 million. Valero`s shares were scheduled to be listed on the New York Stock Exchange shortly after their official opening. In May 1994, the company purchased the 51% of Valero Natural Gas Partners, which it did not yet own, for approximately $117 million. To obtain regulatory approval for the acquisition of UDS, Valero had to sell UDS` Golden Eagle refinery in the San Francisco area and 70 gas stations in Northern California. These assets were sold to Tesoro Petroleum in 2002 for $945 million. The integration of UDS into Valero was done without layoffs – a hallmark of the way Greehey did business. Even when Greehey sold the natural gas business to PG&E, he insisted on making a promise to the buyer that none of his former employees would be laid off.

Although thousands of employees lost their jobs in each of the many major mergers that rocked the oil industry in the late 1990s and early 2000s, Greehey simply said, «This is not the Valero way,» according to the San Antonio Express News. The company under Greehey`s leadership was also known for its generous donation program. Valero becomes the second largest independent refiner in the United States with the acquisition of the Paulsboro* refinery in New Jersey, the first transaction with a major oil company (Mobil). *Sold in 2010 In its first year of existence, Valero moved quickly to consolidate its position and expand into the unregulated sectors of its industry. The company has developed new sources of gas supply, signed contracts in Mexico and Texas, and added new storage facilities. With the announcement that it would spend $14 million to increase its production of natural gas liquids — which were sold at high prices at the time — the company planned to build a $10.2 million processing plant and build a 25-mile pipeline. Valero also spent $4 million on gas exploration and drilling projects. In 2000, Valero purchased ExxonMobil`s refinery in Benicia, California, and invested in 350 Exxon-branded service stations in California, primarily in the San Francisco Bay Area. The company also began selling gasoline under the Valero brand.

In June 2001, Valero acquired the Huntway Refining Company and two asphalt plants on the West Coast.