Valero cuts jobs at Delaware City refinery
Valero Energy Corporation announced today it plans to lay off nearly one-fourth of the workforce at its Delaware City Refinery as it tries to cut costs.
Valero Energy Corporation announced today it plans to lay off nearly one-fourth of the workforce at its Delaware City Refinery as it tries to cut costs.
The layoffs of at least 150 employees and 100 contract workers come as the company posted a $254 million loss in the second quarter.
As Valero looks for ways to save money at all 16 refineries in the U.S., Delaware City’s gasifier unit will shut down at the end of September, and the coker unit will shut down in early October.
The units refine heavy, sour crude, which used to be a profitable process compared to light, sweet crude. But with the economic downturn and decreased demand for refined products, a decent profit margin has turned into a burden.
“You end up paying more to process it than you get for the product you make and that’s why this refinery has been losing money to the tune of millions of dollars a month so far in 2009,” Bill Day, spokesman for Valero Energy said.
Workers were told about the layoffs this morning, and given a contractually mandated 60 days notice. Day says the company will offer early retirement incentives as well.
“We know it impacts people who are part of the Valero family and it’s kind of a sad day at the refinery,” Day said. “But these are steps we’re taking to try and make the refinery viable, that we are hopeful we can increase the profitability at this plant and make it a good plant for the community.
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