Welcome to the U.S. Energy Information Administration overview of aspects of Valero Energy's proposed acquisition of Premcor, which was announced April 25, 2005. Valero reportedly will pay $6.9 billion in cash and stock plus assume approximately $1.8 billion of Premcor debt. The resulting company, Valero Enegy, will be the largest non-vertically integrated refiner (based on refining crude oil distillation capacity) in the United States. For additional information please call the National Energy Information Center at (202) 586-8800.

Aspects of Valero Energy Corp.'s Proposed Acquisition of Premcor Inc.

Background

On April 25, 2005, the Wall Street Journal reported that Valero Energy Corp. agreed to acquire Premcor Inc. for $6.9 billion in cash and stock.   Valero will additionally assume approximately $1.8 billion of debt.   This transaction transforms Valero from the fourteenth-largest domestic refiner at the outset of 2000 (and the fourth-largest prior to this transaction) into the second-largest (and largest non-vertically integrated) refiner currently, pending approval.   The acquisition will significantly increase Valero's presence on the East Coast and the Midwest. This acquisition has no effect on Valero's motor gasoline retail outlets because Premcor has no motor gasoline retail outlets of its own (having spun them off along with the Clark brandname in 2000).

The following links provide company-level data from various public sources to inform discussions of the Valero-Premcor merger.   This data presentation is similar to data presentations that have been previously requested from EIA for other significant energy company mergers and/or corporate alliances.

U.S. Petroleum Refining

    Table 1. U.S. Crude Distillation Capacity Totals
    Table 2. Regional Crude Distillation Capacity Totals

U.S. Motor Gasoline Marketing

    Table 3. U.S. Motor Gasoline Retail Outlet Totals

 

Financial Analysis Team, Office of Energy Markets and End Use, Energy Information Administration, April 26, 2005

Table 1. U.S. Refining Crude Oil Distillation Capacity, Valero and Premcor, 2003

(barrels per calendar day)

Valero
Energy		 Premcor Valero/
Premcor Total		 U.S.
Total		 Percent Share
Valero
Energy		 Premcor Valero/
Premcor Total
1,391,742 761,305 2,153,047 16,894,314 8.2% 4.5% 12.7%
Note: Capacities have been adjusted to reflect transactions through April 26, 2005. In particular, Premcor's acquisition of Motiva Enterprise's 175,000 barrels per day (b/d) Delaware City, Delaware refinery is included in Premcor's total.
Source: Energy Information Administration, Petroleum Supply Annual 2003, Volume 1 (DOE/EIA-0340(03)/1 (Washington, DC, July 2004), Table 36 and Table 40 (both pdf format).

Company-level refinery data for regions of the United States (known as Petroleum Administration for Defense (PAD) Districts) are available in the PAD District Detail Table.

Table 2. U.S. Refining Crude Oil Distillation Capacity, Valero and Premcor PAD District Detail, 2003

(barrels per calendar day)
PAD
District		 Valero
Energy		 Premcor Valero/
Premcor Total		 PAD
District
Total		 Percent Share
Valero
Energy		 Premcor Valero/
Premcor Total
1 160,000 175,000 335,000 1,740,900 9.2% 10.1% 19.2%
2 74,705 331,305 406,010 3,525,610 2.1% 9.4% 11.5%
3 899,250 255,000 1,154,250 7,882,210 11.4% 3.2% 14.6%
4 27,000 0 27,000 582,150 4.6% 0.0% 4.6%
5 230,787 0 230,787 3,163,444 7.3% 0.0% 7.3%
Note: Capacities have been adjusted to reflect transactions through April 26, 2005. In particular, Premcor's acquisition of Motiva Enterprise's 175,000 barrels per day (b/d) Delaware City, Delaware refinery.
Source: Energy Information Administration, Petroleum Supply Annual 2003, Volume 1 (DOE/EIA-0340(03)/1 (Washington, DC, July 2004), Table 36, Table 39 and Table 40 (all pdf format).

Table 3. U.S. Motor Gasoline Retail Outlets, Valero and Premcor, 2003

Valero Premcor Valero/ Premcor
Total		 Valero/Premcor
Total as a Percent
of U.S. Retail Outlets		 U.S.
Retail
Outlets
3,300a 0 3,300a 2.0% 167,346
aOf Valero's 3,300 U.S. motor gasoline retail outlets, 1,145 are company-operated outlets with the majority located in Texas (742, which is 5.1 percent of all Texas motor gasoline outlets) and Colorado (176, which is 8.1 percent of all Colorado motor gasoline retail outlets). Valero also has 1,016 Ultramar-branded retail outlets (209 of which are company-operated retail outlets) in eastern Canada (668 of which are in Quebec), which are supplied by its 215,000-barrels-per-day Quebec refinery.
Sources: Company information: National Petroleum News, Market Facts 2004 (mid-July 2004), pp. 36 - 44. U.S. information: National Petroleum News, Market Facts 2004 (mid-July 2004), p. 90.

Contact:
Neal Davis
neal.davis@eia.doe.gov
Fax: (202) 586-9753

OR

National Energy Information Center
Phone: (202) 586-8800

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