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CHEVRON MAKING DRAMATIC CHANGES AT ITS PORT ARTHUR REFINERY

 CHEVRON MAKING DRAMATIC CHANGES AT ITS PORT ARTHUR REFINERY
 SAN FRANCISCO, March 5 /PRNewswire/ -- Chevron U.S.A. Products Company today announced it will streamline its refinery at Port Arthur, Texas, dramatically reducing operating costs, cutting future capital expenditure requirements and eliminating inefficient, outmoded processing equipment throughout the refinery.
 As a result, the refinery's yield of higher value transportation fuels from each barrel of crude oil processed will improve by about 10 percent, net margins will improve by about $2 per barrel processed and the refinery's output will much more closely match Chevron's regional marketing requirements, reducing the refinery's sales of products to the spot market.
 At the center of the overhaul is the conversion of the refinery to a "single train" configuration, which involves operating one crude oil processing unit and related equipment instead of two. The refinery's rated crude oil processing capacity will drop from 315,000 barrels per day to 200,000 barrels per day.
 As a result, the refinery's 1,900-member work force will be cut by about 700.
 "The new configuration will bring our refinery's average equipment age to 15 years instead of 30, making it one of the most modern, competitive refineries in the Gulf Coast region,'' said Lance Gyorfi, refinery general manager. "I'm confident that the plan we have developed jointly with employees, union leaders and the local community will be effectively implemented, avoiding closure of the refinery and a reduction of hundreds of additional jobs.
 "Reduction of our work force will begin in May, and the new configuration -- which we will implement in early April -- will be fully operational before the end of the year."
 Gyorfi said that the refinery's originally anticipated capital investment requirement of about $1 billion over the next five years will drop by two thirds as a result of the new configuration. The old refinery configuration required the huge outlay for efficiency upgrades and in order to meet requirements of recent environmental regulation changes.
 Chevron Corp. Chairman and CEO Ken Derr had announced January 15 that Chevron would pursue a major change at Port Arthur as part of a wide-ranging plan for improving the corporation's overall competitiveness.
 Four options for the refinery were considered. In addition to the single-train configuration that was chosen, the company also considered selling the refinery, operating it in a joint venture or operating only the petrochemicals portion of the refinery. The last option would have cut the work force by about 1,600 jobs.
 Procedures are being established with the local Job Force Program, in cooperation with the Oil, Chemical and Atomic Workers Union 4-23, the Texas Department of Commerce and others, to provide retraining and job placement for employees who cannot be relocated to other Chevron facilities.
 The Port Arthur refinery was built in 1901 as part of the J.M. Guffy Petroleum Company to refine crude oil from the Spindletop Gusher into kerosene. The name was changed to the Gulf Oil Corporation and the refinery was operated by Gulf until it became a Chevronfacility in 1985.
 -0- 3/5/92
 /CONTACT: Port Arthur: Art Spencer, 409-985-1100; or San Francisco: Larry Shushan, 415-894-2978, both of Chevron/
 (CHV) CO: Chevron ST: Texas IN: OIL SU:


RM -- SF006 -- 5520 03/05/92 14:13 EST
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Publication:PR Newswire
Date:Mar 5, 1992
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