The New Terminal Conversion Trend, Is It Already Being Exported?

Refinery to terminal conversions have, for the most part, occurred quietly. It’s a trend that hasn’t yet swept the market but is slowly beginning to pick up momentum. Companies like Royal Dutch Shell PLC and Petroplus have made headlines for such conversions but larger investment firms are slowly moving in to capitalize on such investments. Many conversions that have happened here in the United States are due to an excessive amount of shuttered refineries created from government subsidies back in the 1950s and 1970s. By the time crude prices collapsed in 1982, many of the smaller refiners were left at a disadvantage within the market at the hands of huge transportation and financial costs.

Now, these long shuttered and mostly unpleasant sleeping giants are being transformed into useful storage and distribution centers that can also accommodate water treatment facilities and other industrial uses. By breathing life back into these dormant sites, small communities are able to experience quality job growth and local tax revenue from these tracts of land.

As the world’s largest consumer and importer of oil, it is essential that local refiners can continue to run efficient operating budgets while local economies can reap the benefits of the transformed sites. However, as the demand for fuel continues to rise in industrializing nations like China and India, such conversions may have some competition from abroad. In the

Shell Oil refinery in Hemmingstedt, Dithmarsch...

Wall Street Journal’s online edition, Ben LeFebvre speaks to a new phenomenon of Asian firms seeking to “expand their fuel-making capacity” through “cheaper” means by purchasing ex-refineries, tearing them down and exporting the components.

Currently our job market is hemorrhaging and our countries responses to creating new opportunities for American citizens are pithy. It’s clear that no community wants to have a shuttered refinery within their city limits, but if it could be commissioned to supply a varied amount of talent and economic feasibility, why would we want to export American benefits to a competing economy?

ICOSA worked with industry insiders to follow a current terminal to refinery conversion happening in Fruita, Colorado. Pick up the next issue of ICOSA, Infrastructure: Building Tomorrow...Today or visit for the story "Converting Refineries to Terminals".

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