Tesoro Corp.'s buyout of BP plc's refinery in California, once finalized, will make the San Antonio petroleum company the biggest refiner in the state and also significantly expand its retail holdings.
Tesoro announced Monday its plans to acquire BP's 266,000-barrel-per-day refinery in Carson, Calif. However, the purchase also includes a retail network of about 800 dealer-operated gas stations in Southern California, Nevada and Arizona as well as the ARCO and ampm convenience store brands.
These independently owned and operated stores currently buy an average of 245,000 gallons per month wholesale from the BP refinery.
This agreement with London-based BP is expected to bolster Tesoro's existing retail network, which currently consists of more than 1,375 branded stations — including nearly 590 company owned gas stations that operate under the Tesoro, USA Gasoline and Shell brands.
The Carson refinery is located south of Los Angeles. Tesoro intends to integrate that refinery with its existing 97,000-barrel-per-day refinery in Wilmington, Calif. Tesoro also owns a 166,000-barrel-per-day refinery in Martinez, Calif.
The purchase also includes three marine terminals; four land storage terminals; four product marketing terminals; and more than 100 miles of pipelines. Tesoro will have pipeline access to Los Angeles International Airport.
The total deal is valued at $2.5 billion.
San Antonio-based Tesoro (NYSE: TSO) operates seven refineries in the western United States with a combined capacity of 675,000 barrels per day. That number will jump to eight facilities once the BP refinery acquisition closes — slated for mid-2013.