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PACIFIC REFINING SUSPENDS HERCULES PROCESSING OPERATIONS

 HERCULES, Calif., April 27 /PRNewswire/ -- Pacific Refining Co. announced today that it plans to suspend crude oil processing operations at its refinery beginning this summer, because of current economic conditions in the refining industry and the large additional investment which would be required to produce new fuels mandated by federal and state laws.
 Pacific's product distribution terminals, blending, rack marketing and international operations will continue. Pacific will serve customers through its existing supply and distribution infrastructure, including wharfs, rack terminals and blending facilities.
 The company said it would secure most process equipment so that it could be restarted should business conditions warrant. Meanwhile, Pacific Refining is continuing to search for alternative uses of this facility.
 Unless an alternative use is found, staffing at the refinery will be reduced. In addition, several positions will be affected at other locations. Pacific Refining said it would make every effort to assist affected workers with their searches for new work.
 "A number of business factors, including narrow margins which have plagued the refining industry in recent years and the deteriorating business climate in California, combined to make suspension of operations the only prudent course of action for our company," said Joseph E. Sparano, chief executive officer of Pacific Refining Co.
 "Pacific Refining also faces unacceptably large future investments needed to reconfigure the Hercules refinery so it can produce fuels mandated by the Clean Air Act Amendments of 1990 and California Air Resources Board fuels regulations."
 In addition, despite three years of efforts, new permits required for construction to reconfigure the facility have not yet been granted. Pacific intends to complete the permitting process for its proposed modification project.
 Earlier this year, Pacific Refining Co. and the Bay Area Air Quality Management District reached agreement on 33 conditions for renewal of Pacific Refining's operating permits, including enhancements to reduce odors.
 The company said it will cease operations in an environmentally responsible manner and will continue to meet its obligations under a number of agreements with state and local agencies.
 "Many people have worked very hard in recent years to keep the Hercules facility running," Sparano said. "Given all of that effort, I regret that expanded government regulations and current industry economics made today's decision unavoidable."
 Pacific is a joint venture owned by subsidiaries of the Coastal Corp. and Sinochem, a state-owned international diversified business corporation of The People's Republic of China.
 -0- 4/27/93
 /CONTACT: Ralph Edwards of Pacific Refining, 510-799-8150/


CO: Pacific Refining Co. ST: California IN: OIL SU:

JB-MS -- LA027 -- 1357 04/27/93 12:08 EDT
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Date:Apr 27, 1993
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