Valero Energy Eyes 2020 Capital Investment at $2.1B
OAKHURST, N.J. (DTN) — In its first quarter earnings release, Valero Energy Corp. said it expects to invest approximately $2.1 billion of capital in 2020, down $400 million from its prior guidance. The latest figure includes capital expenditures for turnarounds, catalysts and joint venture investments.
In the first quarter, the company completed the Pasadena terminal project, which expands its logistics portfolio, increases its capacity for biofuels blending and enhances export flexibility.
Meantime, the new St. Charles Alkylation Unit remains on track to be completed this year and the Diamond Pipeline expansion should be completed in 2020. The DGD plan expansion should also be completed in 2021, subject to COVID-19 related delays. The Port Arthur Coker and the Pembroke Cogen Unit projects have been slowed, pushing out mechanical completion by six to nine months.
As previously announced, Valero and its joint venture partner DGD continue to make progress on the advanced engineering and development cost review for a potential new renewable diesel plant at Valero’s Port Arthur, Texas facility. If the project is approved, operations are expected to commence in 2024, increasing DGD production capacity to over 1.1 billion gallons annually.
“While a tremendous amount of uncertainty remains in our near term, our operational and financial flexibility allow us to navigate through today’s challenging macro environment,” said Joe Gorder, Valero chairman and CEO. “Our advantaged footprint and flexibility to process a wide range of feedstocks, coupled with a relentless focus on operational excellence and a demonstrated commitment to stockholders, positions our assets well as our country and the world return to a more normal way of life.”
On April 13, Valero entered into a new 364-day $875 million revolving credit facility, which remains undrawn, and issued $1.5 billion of debt on April 16 composed of $850 million of 2.7% and $650 million of 2.85% senior notes due 2023 and 2025, respectively.