Excellence Refined - 30 Years - Valero

Barely a month later, Valero became one of the top five
asphalt producers in the nation. Its purchase of Huntway
Refining Company – with two asphalt refineries in
California – ushered Valero into the West Coast asphalt
market. “If there’s an ‘A list’ for asphalt refineries, these
facilities and their employees are on it,” said Gary Arthur,
former manager of specialty products marketing and
current President of Valero Retail. “This acquisition was
a stepping stone to producing higher-quality asphalts
and expanding our asphalt technical know-how.” No
truer words were spoken. All of Valero’s past acquisitions
were stepping stones to greater achievements. Investors
and employees were about to see them all unfold.
Welcome to ‘the new Valero.’
——
Headline, 2002 Special Valero Lines
In May 2001, Valero made its largest acquisition to that
point – the $6 billion purchase of San Antonio-based
competitor Ultramar Diamond Shamrock Corp (UDS).
What started as casual conversations became one of
the fastest-moving mergers in business history. The
companies announced to the world that Valero – the
smaller of the two companies – would more than double
in size by acquiring UDS. The transaction turned Valero
into the second-largest independent refiner in the nation,
with 13 refineries, a throughput capacity of approximately
2 million BPD, and more than 20,000 employees in the
United States and Canada. A retail network and an
interest in a pipelines and terminals partnership also was
part of the deal. In just seven months, Valero closed with
UDS and celebrated the fulfillment of its five-year goal, to
process 2 million BPD, well ahead of schedule.
At the center of the UDS empire were six refineries
– Ardmore, Okla., Wilmington, Calif., Denver, Colo.
(sold to Suncor Energy for $30 million in June 2005),
McKee and Three Rivers, Texas, and Quebec, Canada. A
seventh refinery – the Golden Eagle Refinery in Northern
California – was sold along with 70 retail sites to Tesoro
Petroleum in 2002 for $1.075 billion to satisfy Federal
Trade Commission requirements. What remained for
Valero was a refining powerhouse, one of the nation’s
largest retail operations with approximately 5,000 retail
outlets in the U.S. and Canada, and a stake in a midstream
business called Shamrock Logistics L.P., later
renamed Valero L.P. *
Valero’s 2001 acquisition of El Paso Corporation’s Corpus Christi refinery and logistics assets (far left) helped create a 340,000 BPD refining empire on the shores of
the Corpus Christi Ship Channel. Not a month later, Valero claimed new bragging rights as one of the top five asphalt producers in the nation with the purchase of two
asphalt refineries in California (middle, right).
17 Valero Lines 3oth anniversary edition