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SHELL/PEMEX BILLION DOLLAR REFINERY CONSTRUCTION PROJECT UNDERWAY

    HOUSTON, July 8 /PRNewswire/ -- Groundbreaking ceremonies were held today to mark the beginning of a two-year, $1 billion refinery upgrading construction project at Shell's Deer Park (Texas) Manufacturing Complex.
    The start-up of construction begins a new phase in the joint refining venture agreement between Petroleos Mexicanos (Pemex -- the Mexican national oil company), and Shell Oil Company which was signed earlier this year.  Over 3,000 construction jobs are anticipated.
    The upgrading and new conversion facilities will allow the refinery to efficiently process large volumes of heavy Maya crude received from Pemex, and meet the requirements of the U.S. Clean Air Act. Construction is expected to be completed in 1995.
    Among those taking part in the ceremonies were Texas Gov. Ann Richards; Shell Oil Company President and CEO Phil Carroll; and Pemex Director Gen. Francisco Rojas.  Each turned a symbolic spadeful of soil at the gathering of Shell, Pemex and contractor personnel as well as community and government officials.
    Gov. Richards told the group, "This project is good for the citizens of Texas as well as for the joint venture partners.  The economy will be helped by the creation of new jobs for Texans and by the significant new capital investments.  This partnership symbolizes the kind of economic initiative that the North American Free Trade Agreement could encourage, which Shell and Pemex management join me in supporting."
    In his remarks Carroll stated, "I believe this venture is a true 'win-win' situation."  Carroll added that as a result of anticipated improvements in operating efficiency and flexibility, "we expect the Deer Park refinery to be able to compete worldwide with the best."
    Rojas said, "The beginning of construction marks another significant milestone in the process of Pemex becoming a more competitive, outward-looking company.  Our partnership with Shell complements our restructuring efforts as we further internationalize our business focus.  It offers a secure outlet for processing additional Maya crude, and provides an economic source of unleaded gasoline for Mexico."
    Carroll also expressed Shell's appreciation to the Texas Air Control Board staff for their diligence and expertise in processing the permit applications for the project.  He said that the communications and cooperation between the parties involved in the permit approval may well become a benchmark for future negotiations between industry and state permitting agencies.  An important benefit of the investment program will be a net reduction in air emissions at Deer Park.
    A new coker, hydrotreating unit, sulfur recovery unit and other facilities to be constructed will allow the refinery to process large volumes of heavy Maya crude received from Pemex.  As general partner for the 50/50 venture, Shell operates and manages the refinery.  The approximately 2,400 employees at Deer Park remain employees of Shell Oil Company.  Shell Deer Park chemicals and lubricants production facilities are not a part of the venture.
    The 225,000 barrels-per-day refinery is located at Shell's Deer Park, Texas, manufacturing complex, on the Houston Ship Channel approximately 20 miles east of Houston.  Shell Oil's other refineries are located in Texas, Louisiana, Illinois, California and Washington.
    Petroleos Mexicanos, headquartered in Mexico City, is Mexico's state oil company, responsible for the exploration, production, refining and distribution of crude oil and petroleum derivatives throughout Mexico. In terms of both capital base and total assets (US$45 billion), Pemex is one of the world's largest industrial entities.
    -0-                        7/8/93
    /CONTACT:  Kitty Borah, 713-241-4544, Dee Dee Taylor, 713-241-4544, or Mike Sternesky, 212-632-4888, all of Shell; or Marta Avelar of Pemex, in Mexico City, 011-525-250-7271/


CO: Shell Oil Company; Petroleos Mexicanos ST: Texas IN: OIL SU: JVN JVN John Von Neumann (mathematician)  

GK -- NY069 -- 9551 07/08/93 13:48 EDT EDT
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Publication:PR Newswire
Date:Jul 8, 1993
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