Delta Air Lines Inc. may make a bid for ConocoPhillips’ shuttered refinery in Delaware County.
Energy trade publication Oil Price Information Service, or OPIS, says Delta or an affiliate is interested in purchasing the refinery as a site for making jet fuel.
“OPIS is told Delta Air Lines, or a company affiliated with the airline, has bid on the Trainer refinery with intent to maximize jet fuel production for its operations in the Northeast,” according to OPIS in its most recent “Jet Report.”
“We do not comment on rumor or speculation,” said Eric Torbenson of Delta Tuesday.
A major airline getting into the oil-refining business isn’t as outlandish as it might sound, says Basili Alukos, an analyst with financial firm Morningstar.
“Fuel costs now account for about 30, maybe 35, percent of their costs, so it’s in their best interest to figure out how to lower that input,” Alukos says.
“If they’re able to eliminate [the refiners’] markup, it’s just another way for the airlines to lower their input costs,” Alukos said.
ConocoPhillips has extended a March 30 deadline for bids through the end of May, citing interest from multiple parties.
Reports also say that Sunoco may have as many as four bidders for its refinery in Philadelphia. Sunoco has said a third threatened refinery in Marcus Hook, Delaware County, will not continue to operate as a refinery.