FINDLAY, Ohio (AP) — BP has finally found a buyer for its Texas City refinery, one of the largest and most complex in the U.S.
The total value of the deal could reach $2.5 billion.
Marathon Petroleum Corp. will pay $598 million for the refinery and other nearby pipelines and fuel terminals, plus $1.2 billion for the inventory of oil and petroleum products owned by the plant. Marathon may have to pay another $700 million over 6 years if certain unspecified conditions are met, the company said Monday.
The refinery has a troubled history. A 2005 fire and explosion at the plant killed 15 workers and injured nearly 200 others.
BP PLC been trying to sell refining and other assets to help cover costs associated with the 2010 Deepwater Horizon explosion and oil spill. Since 2010, BP has agreed to sell $35 billion worth of assets, and the company said it expects that to rise to $38 billion by next year.
BP announced in February of 2011 its intention to cut its U.S. refining capacity in half by the end of this year by selling the Carson refinery in Southern California and the Texas City refinery. BP agreed in August to sell the Carson refinery to Tesoro Corp.
The Texas City refinery processes 451,000 barrels of oil per day.
U.S. refiners have been generating enormous profits in recent months because they have been able to buy U.S. crude at prices lower than most competitors around the world. There has been a huge increase in oil production by U.S. drillers and a relative glut of oil in the middle of the country. Refiners are then able to sell their gasoline, diesel and jet fuel at elevated world prices. U.S. exports of petroleum products are on pace to set a record this year.
U.S. refiners are also benefiting from natural gas prices that are far lower than what their world competitors are paying. Natural gas is used to cook oil into refined products.
In morning trading Monday Marathon Petroleum shares jumped 7 percent to $58.73 on the news. Marathon Petroleum shares are up 76 percent since the beginning of the year. BP shares slipped 19 cents to $41.96.