U.S. Refiners to Profit From Clean-Fuel Rules

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The oil refinery owned by PBF Energy near Delaware Bay town was mothballed nearly a decade ago – however, today it is running almost full-bore, and PBF and a business partner are spending $100 million to expand it, Wall Street Journal reported.

The refinery is seeking to capitalize on new international rules that require cleaner-burning fuels on the world’s oceangoing ships starting January 1.

Refiners in the U.S. are anticipating a bonanza – as the industry estimates it has spent $100 billion on upgrades in the last decade to make cleaner fuels, putting it in a position to boost revenues if the rules raise the demand and prices for the products it makes, as many expect, the Journal adds.

The new rules were met with skepticism by the Trump administration and others concerned about the impact on jobs and energy prices. At places like Delaware City, however, the upgrades required to meet the new standards have translated into more good-paying jobs, said James Maravelias, president of the Delaware Building Construction Trades Council.

As car makers and chemical plants have left the region, he said, refiners have become some of his members’ most reliable employers.

“Energy is pretty much it for us,” said Maravelias, who is based out of Newark, Del. “There’s no other industry that’s bringing in those kinds of jobs to Delaware right now.”

At refineries, maintenance work, usually conducted when the refinery is shut down, often employs 1,200 people at a time, Maravelias said. And expanding the plant in Delaware City suggests a future full of even more of those tuneups and more work to go around, he added.

A rosy outcome isn’t certain for everyone affected – other sectors, countries and even refiners – but some analysts and economists are expecting that a boost for refiners will have a wide-ranging positive impact. With record U.S. fuel output leading to more exports and fewer imports, more revenue stays within the country, often reinvested, the Journal writes.

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