US oil major company Chevron Corporation has held negotiations to acquire Pasadena Refining System Inc., (PRSI), a Texas oil refining unit owned by Brazil's state-run oil firm, Petroleo Brasileiro SA (Petrobras), people claiming first-hand knowledge with the corporate issue tipped the press this week.
If this deal with the Pasadena, Texas-headquartered refinery pushes through, it would further expand Chevron's oil refining capacity, given that the unit can process roughly 110,000 barrels per day of light crude oil, a report from Kallanish Energy indicated, citing sources familiar with the matter.
However, Chevron might have to shell out more capital to upgrade the station since it has been limited in the type of crude it can process following a tragic fire in 2011 that engulfed the complex, rendering one of its processing units useless.
It would still be a huge boon for the San Ramon, California-based company as the PRSI acquisition also includes an open land which it can use to expand the plant.
Other than that, the Caltex parent company is also looking to discuss a joint venture on gas-to-liquid processing with Kinder Morgan Inc, which is a major energy infrastructure provider in North America, a couple of tipsters told Reuters.
Kinder Morgan happens to operate a plant near PRSI which separates gas liquids into a more refined state like ethane, propane, and other fuel forms.
Involved parties Chevron, Petrobras, and Kinder Morgan have yet to release official statements to clarify the issue.
Plunged In Debt
Petrobras reportedly put PRSI up for acquisition earlier this year after the plant, which has its own export docks strategically located on the Houston Ship Channel leading to the US Gulf of Mexico, has sunk to more than $1.18 billion in operating costs since 2006.
Meanwhile, it would be quite difficult for Petrobras to redeem this station since it has acquired for itself a huge amount of debt. The Brazilian firm has been looking to divest more than $20 billion in assets by year-end to mitigate its financial situation but the plan has drawn flak from the company's union.
There's a huge possibility for the proposition to get dumped even more considering the growing legal and political hindrances.
On Sunday, Brazil will hold its presidential election. One of the front-runners on this political affair is Jair Bolsonaro.
One of the highlights of Bolsonaro's campaign is the promise to restructure the country's oil firm which will start by installing new managers within its corporate ranks.
