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ExxonMobil to Sell its Torrance Plant to PBF Energy for $537M

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ExxonMobil CorporationXOM announced its decision to sell its Southern California refinery to New Jersey-based energy company - PBF Energy Inc. - for $537 million.

The refinery had been crippled by an explosion over six months ago, which wounded four contractors, caused heavy damage at the plant and shocked nearby residents. The Southern California refinery, which is known as the Torrance plant, remained shut ever since. This resulted in substantial gas deficiency and hence, an increase in gas prices in California. The Torrance plant has a capacity to process 155,000 barrels of crude oil per day.

ExxonMobil was charged over $566,000 by California regulators for workplace safety and health violations.

Spread over an area of 750 acres, the refinery yields 1.8 billion gallons of gasoline per year. This is equivalent to 8.3% of the state's total refining capacity. Other storage facilities and pipelines are also up for sale. This includes a 116-mile section that carries San Joaquin Valley crude to the refinery as well as pipes that provide access to the Ports of Long Beach and Los Angeles.

The refinery currently has about 700 staff members and 700 contractors in its employment. PBF Energy intends to employ these personnel at the plant.

Per PBF Energy, the plant will be restarted before the sale is concluded next year. Interestingly, PBF Energy recently purchased another ExxonMobil refinery in Louisiana. Subsequent to these purchases, PBF Energy will be capable of processing 900,000 barrels of oil daily.

ExxonMobil carries a Zacks Rank #5 (Strong Sell). Some better-ranked stocks from the same space are Alon USA Partners, LP ALDW , Braskem S.A. BAK and ReneSola Ltd SOL . All these stocks sport a Zacks Rank #1 (Strong Buy).

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EXXON MOBIL CRP (XOM): Free Stock Analysis Report

RENESOLA LT-ADR (SOL): Free Stock Analysis Report

BRASKEM SA (BAK): Free Stock Analysis Report

ALON USA PTNRS (ALDW): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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