Pennsylvania

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Philadelphia Refinery to Rely on Shale Oil and Gas

Susan Phillips / StateImpact Pennsylvania

Workers at the former Sunoco refinery, now the Philadelphia Energy Solutions plant, watch the unveiling of the new logo.

A cross-section of red and blue politicians, industry and union executives in dark suits, and refinery workers in blue jumpsuits gathered for a barbeque meal Wednesday at the newly minted Philadelphia Energy Solutions plant in southwest Philadelphia. The group gathered to celebrate saving the more than 140-year-old plant from extinction after Sunoco announced plans to close the refinery last year. Efforts to work out the deal that saved the plant included help from the White House to Philadelphia City Council, and included Republicans, Democrats, union representatives and industry. A private equity firm, the Carlyle Group, purchased the refinery, which has already started processing domestic crude from the Bakken Shale in North Dakota, and the Eagle Ford Shale in Texas.

Philadelphia Energy Solutions CEO Phil Rinaldi says the plant is refining 20,000 to 30,000 barrels of shale oil a day, and they plan on reaching 140,000 to 180,000 barrels a day once a rail car unloader is built. In the past, large tanker ships brought crude oil from overseas. But PES plans on using trains to transport oil from North Dakota.

Rinaldi says the refinery will become a “major consumer” of Marcellus Shale gas, which will provide a “broader base” for the facility. The first step, he said, is to build a mild hydrocracker to improve both the yields and the quality of the crude oil.

“And that creates a bridge to the Marcellus Shale gas,” said Rinaldi.  ”Because to fire that mild hydrocracker, you want to have a good availability of hydrogen. And then we’ll begin to bring in Marcellus Shale gas, build the hydrogen plant, to fire that.”

Rinaldi says shale gas will also be used to power a 600-to-700 megawatt co-generation plant, and down the road, a shale gas-to-liquids processor.

Bill Marino has worked at the plant for 37 years as a carpenter and is one of the 850 people who did not lose their job because of the deal.

“This is a great day for a lot of people,” said Marino. “A lot of families, a lot of little kids and wives are affected by this. Who knows, some young man might go to a better school, a better college because of what took place here.”

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