Casey to Energy Secretary: Get Involved in Refinery Closures

In Letter, Casey Warns that Rising Fuel Prices Could Threaten Economic Recovery

WASHINGTON, DC – U.S. Senator Bob Casey (D-PA) is urging Energy Secretary Steven Chu to personally become involved in the issue of refinery closures in Philadelphia and Delaware County.

Citing this week’s Energy Information Administration report showing fuel price volatility, worsened supply shortages of heating oil and increased dependence on foreign supplies of refined fuel products are likely consequences of reduced refining capacity in the northeast, Senator Casey implored the Administration to become directly involved in the issue.

“Rising gas prices are of utmost concern to my constituents in Pennsylvania and will hinder the nation’s economic recovery, so it is imperative that the Administration become directly involved in the issue of reduced refining capacity in the northeast,” said Senator Casey. “Energy prices across the board are likely to rise as a result of the decision to close these refineries, so I implore Secretary Chu to ensure that the Administration is doing everything in its power to protect consumers and allow the economic recovery to continue.”

Senator Casey recently hosted a bipartisan meeting with lawmakers and workers from the refineries in Philadelphia, Trainer and Marcus Hook to discuss the impact that plans to shutter the refineries would have on the workforce and energy supplies in the northeast.

Senator Casey has also called for a Senate hearing on the impact that the refinery closures would have on energy prices and has put pressure on the refinery owners to find suitable buyers to ensure that production is not permanently shut down.

In his letter to Secretary Chu, Senator Casey wrote, “Especially given the recent increase in gasoline prices, I remain concerned about how the loss of the three Pennsylvania refineries will affect the region’s economy and National energy prices as well as the workforce and their families.  The closures will have a lasting impact not only on the region, but on the entire Nation.” 

The full text of Senator Casey’s letter to Secretary Chu is below:

The Honorable Steven Chu

Secretary

United States Department of Energy

Dear Secretary Chu:

I am writing to urge you to become personally involved in the issue of reductions in Northeast refining activity.  Two companies have announced the sale of three Philadelphia-area refineries that produce more than half of the refined products on the East coast.  As you may know, the U.S. Energy Information Administration (EIA) released a report that stated a reduction in refining caused by the potential shuttering of these facilities is likely to impact supplies of petroleum products and to create price volatility. 

Sunoco announced plans to sell its refineries located in Philadelphia and Marcus Hook, while ConocoPhillips announced plans to sell its facility in Trainer.  This issue is of the utmost importance to my constituents in Pennsylvania, the entire Northeast region and the Nation.  The Marcus Hook and Trainer facilities currently stand idle, awaiting a buyer.  If no buyer is found and these facilities were to permanently close, the loss of our refining capacity on the East coast will have a substantial ripple effect across the Nation’s economy.  Recent reports indicate that Hovensa LLC intends to shut down its refinery in the U.S. Virgin Islands, which will further reduce supplies on the East coast. 

The EIA report discusses the troubling consequences of reduced refining capacity, including:

  • Likely price volatility and spikes due to reduced supply, longer delivery times and transportation bottlenecks, with the biggest effect on diesel, gasoline and jet fuel;
  • Worsened supply shortages of home heating oil; and
  • Increased dependency on foreign supplies of refined products.

As a result of the decisions to close these refineries, energy costs across the board are likely to rise, resulting in potentially record setting prices at the pump.  Especially given the recent increase in gasoline prices, I remain concerned about how the loss of the three Pennsylvania refineries will affect the region’s economy and National energy prices as well as the workforce and their families.  The closures will have a lasting impact not only on the region, but on the entire Nation.  The companies’ decisions to shutter the refineries will hinder the Nation’s efforts toward economic recovery.

For these reasons, I ask that you become personally involved in this matter.  Thank you for your attention to my concerns and I look forward to working with you on this issue in the future. 

Sincerely,

Robert P. Casey, Jr.

United States Senator

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