Valero to ‘idle, restructure or cease operations’ at Benicia refinery in California

Valero Energy Corp. announced April 16 that its refining subsidiary in California has submitted notice to the California Energy Commission of its current intent to “idle, restructure or cease refining operations” at its Benicia refinery by the end of April 2026.

The Benicia refinery is located northeast of San Francisco on the Carquinez Straits of San Francisco Bay.

It processes feedstocks into California reformulated gasoline blendstock for oxygenate blending (CARBOB) and conventional blendstock for oxygenate blending (CBOB) gasolines, CARB diesel, diesel, jet fuel and asphalt.

Gasoline production is primarily CARBOB, which meets California Air Resources Board’s specifications when blended with ethanol.

The refinery receives feedstocks via a marine dock and pipelines and distributes most of its products via pipeline and truck.

Its throughput capacity is 170,000 barrels per day.

Benicia’s cogeneration system can generate 50 megawatts of power, according to Valero. 

The cogeneration system produces both electricity and thermal energy or steam and is recycled back into the refining process for other uses.

Valero said it continues to evaluate strategic alternatives for its remaining operations in California.

“We understand the impact that this may have on our employees, business partners and community and will continue to work with them through this period,” said Lane Riggs, the chairman, CEO and president of Valero.

The refinery employs more than 400 people.

In connection with the evaluation of strategic alternatives for Valero’s operations in California, the company said a combined pretax-impairment charge of $1.1 billion was recorded for the Benicia and Wilmington refineries and is expected to be treated as a special item and excluded from first quarter 2025 adjusted earnings.

Also included in this amount, according to Valero, is the recognition of expected asset-retirement obligations of $337 million as of March 31.

Valero owns 15 petroleum refineries located in the U.S., Canada and the U.K. with a combined throughput capacity of approximately 3.2 million barrels per day.

Valero is a joint-venture member in Diamond Green Diesel, which produces low-carbon fuels including renewable diesel and sustainable aviation fuel (SAF), with a production capacity of approximately 1.2 billion gallons per year in the U.S. Gulf Coast region.

Valero also owns 12 ethanol plants located in the U.S. Mid-Continent region with a combined production capacity of approximately 1.7 billion gallons per year.