Tesoro to Begin $30 Million Upgrade to North Dakota Refinery

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Tesoro to Begin $30 Million Upgrade to North Dakota Refinery

BISMARCK, N.D. -- A planned $30 million overhaul at Tesoro Petroleum Corp.'s Mandan refinery will help the factory make more gasoline once the project is finished, company officials said.

The refinery will not produce gasoline during most of September while the work is being done, Tesoro spokesman John Berger said. Customers should not see any fuel shortages or price increases as a result because the company has been building up gasoline stocks in anticipation of the shutdown, The Bismarck (N.D.) Tribune reported.

Normally, the refinery works nonstop to process up to 54,000 barrels of crude oil daily, making gasoline, propane, diesel and jet fuel. It has 220 employees, and none will be laid off during the shutdown. "They'll be busier than ever," Berger said.

No major upgrades have been done in the last eight years at the refinery, forcing it to cut back from its maximum production of about 60,000 barrels of crude daily, Berger said. A barrel is 42 gallons. The project is scheduled to begin Sept. 5. Several pieces of refinery equipment need to be cleaned and overhauled to maximize production, Berger said.

Tesoro spokesman Leif Peterson said that once the work is completed, gasoline production at the plant should increase about 10 percent. Company officials would not disclose the amount of gasoline produced at the refinery.

Tesoro, which is based in San Antonio, has refineries in five Western states and Alaska. Tesoro bought the Mandan refinery from BP two years ago. Beginning next year, the company will spend $87 million to lower emissions at the refinery and to cut sulfur content in gasoline and diesel, Berger said.

New federal rules require refineries to lower sulfur content in gasoline to 120 parts per million by 2005 and to 30 parts per million by 2006. Sulfur content in diesel fuel also must be cut as much as 97 percent over the next three years.

Berger said the company should have no problem meeting the deadlines. The North Dakota crude oil it processes has a lower sulfur content, he said.