Tesoro Corporation TSO today
announced that it will cease refining operations at its Kapolei refinery
during April of this year, and begin the process of converting the refinery to
an import, storage and distribution terminal. Tesoro Hawaii is committed to
maintaining its focus on safe and environmentally sound operations during the
shutdown and conversion process.
Tesoro Hawaii will maintain the existing distribution system to support
marketing operations and fulfill its supply commitments while continuing to
offer the terminal, distribution and retail assets for sale. Upon conversion
of the refinery to an import, storage and distribution terminal, Tesoro Hawaii
believes third party utilization of the terminal and associated logistics will
facilitate ongoing supplies of refined products.
Tesoro expects to report one-time charges in the fourth quarter 2012 related
to the conversion of the refinery to a terminal, including charges for asset
impairment and asset retirement obligations. The one-time charges are
estimated to be $1.00 - $1.10 per share. The Company also expects to realize
between $300 million and $350 million in cash by the end of 2013, driven by a
reduction in working capital needs as a result of this conversion.
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