Sinclair Plans $1B Tulsa Expansion
by Jason Womack Tulsa World, Okla.
September 07, 2007
Sinclair Oil Corp. plans to invest $1 billion in its Tulsa
refinery to expand fuel production for the Mid-Continent market, city and company officials said Thursday.
The investment -- billed as one of the largest single private investments
in the city's history -- will nearly double Sinclair's work force while
increasing the refinery's production capacity by about 60 percent.
"This $1 billion investment tells the world that Tulsa is here to do
business," Mayor Kathy Taylor told reporters during a press conference announcing the expansion.
The refinery employs about 260 people and could add another 200 by 2010,
when the project is scheduled to be completed, officials said.
Sinclair will add additional units to turn low-grade sour crude from the
oil sands of western Canada into diesel fuel and gasoline without expanding
the refinery's footprint.
The Salt Lake City-based refiner will also add equipment that will reduce
emissions by 1,000 tons per day.
Capacity at the refinery is anticipated to grow from 70,000 barrels of
fuel per day to 115,000 barrels.
"We are going to provide the market with more gasoline and diesel," said
Kevin W. Brown, executive vice president of Sinclair. "That's important for
A new refinery has not been built in the United States since 1976. But
the industry has engaged in expansion, building out existing facilities to
meet a growing demand for fuel.
For the last two years, U.S. refining capacity has increased by 300,000
barrels, according to the American Petroleum Institute. The industry has added
the equivalent of a new refinery every year for the past decade.
John Pilkington, chairman of the Oklahoma Independent Petroleum
Association and president of Tulsa-based Muirfield Resources Co., said
expanding refineries reduces dependence on foreign oil.
"Anything we can do to increase refined product is a plus for us," he
According to the API, the U.S. has imported an average of 1.42 million
barrels of gasoline a day for the last five weeks, an increase of nearly 7
percent over the same period a year ago.
Sinclair said it considered the Tulsa refinery's proximity to pipelines
and oil storage facilities -- and the city's infrastructure and local utility
services -- before committing to the expansion.
"We are reinvesting the profits we've seen over the last several years,"
The company will also require additional pipeline capacity between the
Tulsa refinery and the Cushing Interchange -- an oil hub about 50 miles to the
Magellan Midstream Partners LP said Thursday that it will be able to
supply additional crude by the end of the year.
"We have taken existing infrastructure and modified it to take 30,000
barrels per day of crude from Cushing to the Sinclair refinery," said Bruce
Heine, a spokesman for Tulsa-based Magellan.
The pipeline company has added additional connections to its pipeline to
accommodate Sinclair's needs.
Sinclair Tulsa Refining Co., a wholly owned subsidiary of Sinclair Oil,
will file an application Friday with the Oklahoma Department of Environmental
Quality for an air quality construction permit -- required to expand the
Michael Neal, president and CEO of the Tulsa Metro Chamber, said the
three-year expansion project is will require 4 million man-hours during the
construction period and add $45 million to the Tulsa economy.
Sinclair said the company would prefer to hire construction workers
"It's huge to think of a billion-dollar investment," Neal said. "It will
have a huge economic development impact."
--2005: Sinclair Tulsa Refining Co. begins planning, feasibility studies
and engineering for the expansion.
--2007: Sinclair files an application to expand the Tulsa refinery.
--2008: Construction is expected to begin following approval by the
Oklahoma Department of Environmental Quality.
--2010: Refinery expansion is scheduled for completion.
Copyright (c) 2007, Tulsa World, Okla. Distributed by McClatchy-Tribune Information Services.
Sinclair Oil Corp.
Tulsa, OK United States