BP Threatens to Shut Down Refinery Amidst Union Feud

Strategic Insights -

The Chemical and Atomic Workers International Union (OCAW) Local 8-234 is at odds with BP Oil Co. over the planned sale of its Marcus Hook, PA refinery to Tosco Corp. BP has issued a warning that it will shut down the refinery partially or completely if the union becomes an obstacle to the sale. OCAW officials claim that BP may be picking an unnecessary fight with labor.

OCAW officials argue that BP has proven itself to be a poor manager of refineries, while Tosco has shown a track record of profitability as a merchant refiner. However, Tosco wants to make changes to the Marcus Hook refinery to make it profitable, which could result in job losses. The union is objecting to Tosco's plan to selectively choose which workers to keep.

Key Takeaways:

  • The sale of BP's Marcus Hook, PA refinery to Tosco Corp. is pending, but BP has threatened to shut down the refinery partially or completely if the union, OCAW Local 8-234, becomes an obstacle to the sale.
  • OCAW officials claim that BP may be picking an unnecessary fight with labor, citing the company's poor management of refineries compared to Tosco's success as a merchant refiner.
  • The union is objecting to Tosco's plan to selectively choose which workers to keep, citing concerns about job losses.
  • About 500 jobs, including 365 held by OCAW members, are at stake at the refinery and its distribution facilities.
  • OCAW President Robert Wages suggests that a shutdown of the refinery could lead to a broader feud between the union and Tosco at other refineries, including those in California and Washington.
  • The union is facing the uncomfortable fact of shrinking employment in the U.S. oil industry, which may force them to make contract concessions to Tosco.

Statistics:

  • The Marcus Hook, PA refinery has a capacity of 190,000 b/d.
  • Tosco has agreed to buy the refinery for $235 million by February 1.
  • About 500 jobs are at stake at the refinery and its distribution facilities.
  • 365 of the jobs affected are held by OCAW members.

Sources:

  • "BP Threatens Shutdown if Union Opposes Refinery Sale" (no publication date or author specified)
  • "BP's Likable, but a Poor Refiner?" by Jane Miller (no publication date or author specified)