Valero is also investing in alternative energy , like ethanol and wind. Valero has invested in biofuel companies and diesel fuel produced from recycled animal fats and cooking oils. The United States has never exported much crude oil. But even if we wanted to ship it away, there are laws that ban most all overseas crude exports. Now, as domestic drilling continues to surge, some are calling […].
This […]. Early Wednesday morning, a caravan of buses set out from the Houston area, headed for Austin and the headquarters of the Texas Commission on Environmental Quality. Their goal? To protest a request from Valero Energy Corp. Gold 1, Silver Vix CMC Crypto 1, FTSE 7, Nikkei 29, Read full article. More content below. In this article:. About Valero. Recommended Stories. Motley Fool. In addition to these moves, Valero abandoned its attempts to find oil and gas reserves, shutting down its exploration activities.
This meant, however, that the core of the company was its money-losing refinery. By , however, the climate for petroleum refining had improved, and Valero began to see a turnaround in its fortunes. Noting that the recent turmoil in the oil and gas industry had put many refineries out of business, Valero's leaders were confident that domestic demand for gasoline would continue to exceed refining capacity, keeping prices high.
In addition, the company counted on the fact that the product it refined was high-quality, high-octane, clean-burning unleaded gas, for which it anticipated a growing demand. On the supply side, Valero noted that prices for resid had fallen as stockpiles had grown, and the company moved to upgrade its refinery, increasing capacity. To assure future steady supplies of raw materials, the company sought to take on a foreign petroleum producer as a joint owner in the refinery.
The company's fortunes continued to improve in the following year. Valero's half-owned natural gas operations had profited from the deregulation of the gas industry; it increased its sales by adding customers outside Texas. The company was able to transport, through interstate gas pipeline linkups, and sell gas to clients in other states and in Mexico. Its number of gas processing plants had grown to Valero also continued to upgrade its oil-refining facilities. The company added a device that enhanced the octane level of the gas it produced and also constructed a natural gas processing plant that split the gas into products to be used in petrochemicals or oil refining activities.
As a result of refinery upgrades and the strengthened market, Valero was able to restore its dividend payment in a sign of fiscal health in the second quarter of that year.
Valero's recovery from the severe difficulties it had experienced in the mids continued as the company moved into the s. The world oil industry was thrown into turmoil in August when Iraq invaded major oil producer Kuwait, driving up the prices of both crude oil and refined petroleum products.
In a reversal of earlier conditions, petroleum refining accounted for a vast portion of the profits, while the company's interest in its natural gas partnership contributed only 20 percent of the company's returns. The launching of the Allied offensive in the Persian Gulf in early immediately drove petroleum prices down. Looking to profit from the general move toward more environmentally conscious, cleaner-burning fuels, such as natural gas and the high-octane products refined at its Corpus Christi facility, Valero continued to upgrade its plants in In addition, the company expected that by their entire gasoline output would be made up of reformulated gasoline.
With an eye to further expansion, the company solidified its balance sheet by repurchasing the outstanding shares of an old stock offering and sought permission to raise money for expansion by issuing new stocks. Valero also opened an office in Mexico City, in an effort to enhance its relationship with the Mexican government and assist it in its search for clean energy. Valero said that it wanted to expanded the natural gas business, but that the limited partnership structure inhibited growth.
Valero soon began seeking a buyer for the business, however, an effort that continued into Late in Valero officially announced plans to split the company up in order to concentrate solely on oil refining and marketing.
The first acquisition of this buying binge also occurred in Valero bought the Basis Petroleum, Inc. Basis operated three refineries on the U. The three refineries had a combined capacity of , barrels per day, more than doubling Valero's existing output from its original refinery. Although the Basis refineries had been operating at a loss for Salomon, this was in a way a positive for Valero: The facilities were in need of improvements, giving Valero an opportunity to overhaul the refineries just as it had done with the Corpus Christi plant.
Already in late , the company announced plans to increase capacity at all three Basis facilities. After seeing its bottom line suffer in the late s because of low crude oil prices, Valero, along with the rest of the U. Soaring crude oil prices, surging demand for refined products, and refineries operating at or near their capacities produced a volatile mix leading to higher prices at the pump and soaring net income for the refiners.
In , the company commissioned its first full-scale refinery. This provided the company with much-needed geographic diversity. The transaction also marked Valero's entry into the retail market because it included nearly gasoline stations.
However, what really catapulted the company into retailing ranks was its acquisition of San Antonio-based Ultramar Diamond Shamrock in Through this acquisition, Valero increased its revenues considerably. The company had another milestone year in In , the company expanded its geographical footprint by purchasing Pembroke Refinery in Wales, which marked its entry into Western Europe.
Valero spun off its retail business as an independent public company, CST Brands Inc, which became the second-largest publicly traded fuel and convenience merchandise retailer in North America.
Currently, the company has 15 refineries in the U.
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