As government scrutiny intensifies on ExxonMobil, the company is apparently getting out of the state. Exxon is reportedly selling its hobbled Torrance refinery in the wake of an investigation into management's responsiblity for an explosion Feb.18 that endangered workers and the community.
Consumer Watchdog wrote a letter last week to the governor, California Attorney General and US Attorneys, alleging a coverup by Exxon of evidence and concealing of witnesses that could prove the refinery made a decision to keep operating a fluid catalytic cracker while repairing a compressor. That decision touched off the build up of fumes that exploded, destroying a key piece of air pollution equipment 12 stories high called an electrostatic precipitator. Industry sources told Consumer Watchdog that workers emptying waste at the bottom of the electrostatic preciptator barely escaped when sensors on their belts alerted them to the presences of fumes.
Is Exxon trying to wash its hands of responsibility for ignoring subpoenas, allegedly hiding witnesses and endangering the public? We knew investigators were intensifying their scrutiny of Exxon's actions during the past week and sources say it's got under the company's skin.
While Exxon may be selling with hopes that the investigation will go away, companies that have been held responsible for negligence and endangerment of workers or the community have had to pay fines in the past, despite sales of their companies to new owners. In fact, the sale could loosen lips among workers at the facility who are too scared to talk to state and federal investigators for fear of their jobs.
For the new owner of the refinery, this is an opportunity to force the refinery to change to safer practices. A leak of hydrofluoric acid earlier this month soured air regulators on allowing the Torrance refinery to reopen using old air pollution equipment. Hydrofluoric acid is extremely dangerous. Explosions can set off vapor clouds travelling big distances close to the ground, severely injuring or even killing people. Exxon Torrance is one of only two refineries in California left using it as a catalyst to boost octane.
The buyer is apparently PBF Energy, and the sale will close the second quarter of 2016. According to sources, Exxon has promised the buyer that the refinery will be fully operational in February. The refiner and supplier of unbranded transportation fuels is no stranger to Exxon. It's purchasing a refinery from Exxon in Chalmette, Louisiana, and owns other US refineries in Ohio, New Jersey and Delaware.
This could be good news for consumers as currently only two companies--Chevron and Tesoro--control 54 percent of California's refining capacity. This puts a new player in charge of 8 percent of the state's capacity, which boosts competition. Four companies now control more than three quarters of that capacity.
The Exxon Torrance explosion touched off a price spike that cost Californians $6 billion between February and August compared to what US consumers pay elsewhere. Southern Californians paid the biggest price. Exxon bears responsiblity for the Golden state gouge. And new owner or not, Exxon can exit the state, but it cannot avoid the law.