Central Valley Petroleum Industry Golf Tournament
Alliance Petroleum Annual Meeting
CIOMA Destruction Derby
Want to see the photos that didn't make the issue? Check out the Cutting Room Floor.
Shell Sells 20 Stations to Nakash Enterprises
CHS Buys 33 Zip Trip Locations in Washington, Idaho
Valero Acquires 72 Stations From Albertson's
Gasoline-Diesel Mix Sold To Motorists
Fry's To Add Fuel To Arizona Stores
Pacific Ethanol Idaho Plant Begins Operations
SACRAMENTO, CA.— Shell Oil Products U.S. has sold 20 of its branded service stations in the Sacramento area to Nakash Enterprises LLC, operating under the name Vintners Distributors Inc.
Nakash Enterprises operated 22 Shell-branded retail locations throughout California prior to the purchase of the 20 additional sites, announced in May.
"Vintners Distributors has a strong history of growing the Shell brand in California," stated Bill Spurgeon, west region general manager for Shell. "The company's lengthy experience as a Shell operator, coupled with its extensive knowledge of the retail fuel market in northern California, will help to strengthen the Shell network in Sacramento."
All 20 locations will maintain the Shell brand.
"We're proud to add these Shell retail locations to our northern California portfolio," Nick Goyal, managing member of Nakash Enterprises, said in a statement. "Shell is among the most recognized premium retail brands among consumers." He added, "Like Shell, we are committed to providing motorists with high-quality fuels and excellent customer service."
SPOKANE, WA. — CHS Inc. is expanding its retail holdings, purchasing 33 Zip Trip service stations and convenience stores in the greater Spokane area from Jopo Inc., and Jo-By Enterprises LLC.
The Zip Trip c-stores will be rebranded to Cenex; the conversion is expected to be completed by "mid summer." The stores will be operated as part of the CHS energy business utilizing existing Zip Trip store management and retail staff.
Included in the deal are Zip Trip facilities in metropolitan Spokane and Clarkston, WA, as well as Lewiston, Coeur d' Alene, Grangeville, Moscow, and Bonners Ferry, ID.
With the addition of the 33 sites, Cenex will operate 39 branded locations in Spokane, making the Washington city the company's largest single metropolitan market.
"These are clean, operationally-efficient stores with professional staff who will uphold the Cenex brand promise," says Don Olson, senior vice president of refined fuels for CHS. "This acquisition is the latest strategic move in our continued growth and is good news for everyone who represents the Cenex brand."
He added, "We have a long history of serving Pacific Northwest consumers with Cenex-branded retail facilities and products and look forward to expanding in the Spokane market. The proximity to the Laurel, Montana refinery will allow us to efficiently provide reliable supplies of quality gasoline and diesel fuel to these locations."
SAN ANTONIO, TX. — Valero has signed an agreement to purchase 72 convenience stores and fueling kiosks from supermarket operator Albertson's LLC. The purchase price was not disclosed.
In the west, the sites primarily are located in the Denver, Colorado metro area and greater Phoenix, Arizona. Also included in the deal were Albertson's fueling sites in Texas and Louisiana.
The former Albertson's stations will be operated as company-owned service stations under the Valero fuel brand. The c-stores will be rebranded to Valero's Corner Store concept.
"[The Southwest] is where we are enhancing operations," said Valero spokesman Bill Day. "We are looking forward to expanding in this market, and we feel customers are already familiar with Valero and will be excited by the new stores."
The transaction is expected to close in August 2008, subject to governmental approval.
FRESNO, CA. — At least 150 drivers in Central California have been affected after diesel fuel was mistakenly put into tanks meant to dispense regular and mid-grade gasoline.
The problem occurred at the Kinder Morgan terminal at Central and Maple Avenues in Fresno. According to the company, 16 tanker trucks loaded the gasoline-diesel mixture between 7 p.m. on May 8 and 4 a.m. on May 9 and delivered it to stations in the Fresno area.
Kinder Morgan officials say the problem is under investigation and they don't know how the mix-up occurred. The original source of the fuel was in Martinez, CA., and it moved to the tank farm via pipeline from the Bay Area.
Among the Fresno stations affected by the fuel problem were Bad Bud's at Herndon and Cedar, the Valero station at Blackstone and Cedar, the Valero station at Sierra and Blackstone, and the Fast Trip at Dakota and Hughes as well as the Costco at R Street in Merced, CA.
Jeff Cole, Costco's vice president of gasoline, said the fuel was added to the station's tanks at 6 a.m. and the problem was recognized around 9 a.m. The pumps in question were turned off after the problem was brought to Costco's attention.
All of the service stations that received the tainted fuel were notified as soon as the problem was discovered and the fuel has been removed from the station tanks and sent back to the refinery.
Talking to local reporters, Steve Follet of Bad Bud's explained, "I have to get 50 thousand gallons out of the ground, get some clean fuel back in it and purge all of the dispensers."
However, the problem was discovered by customers who had immediate problems with their vehicles after filling their tanks.
Local driver Melissa Ford filled up and then went to an appointment. She stated that when she returned to her vehicle, "my car doesn't want to start. It starts shaking and everything. I call my husband he says 'well don't move it, just go home and get the other car.' Well, the other car was on empty so I stopped and got gas at the same station, at Valero," says Ford. After filling up the second car with the tainted fuel, both were towed away for repairs.
"We very much apologize that this occurred," said Kinder Morgan spokesman Larry Pierce, based in Houston, TX. "We are investigating how the gasoline was mixed with diesel fuel. We sincerely apologize to anyone who has been inconvenienced by this situation and we will promptly address claims presented by the owners of the product, the service stations impacted, and the owners of vehicles that may have been affected."
Pierce encouraged drivers who believed they refueled with tainted gasoline to contact the station where they bought the fuel. Kinder Morgan is asking station employees to verify that drivers bought fuel during the mix-up from their station. If it appears to be a valid claim, station employees are being asked to give the driver a toll-free number to receive reimbursement costs from Kinder Morgan.
Kinder Morgan says they have received over 150 calls from drivers on the toll-free number so far. Pierce added, "We are promptly addressing claims that may have been presented."
Repair costs to the vehicles, which would include having the bad fuel removed from tanks and changing fuel filters, are estimated between $200 and $600 per car.
Speaking with local reporters, Bud Ruschhaupt, owner of Bad Bud's, stressed the point that tainted gasoline is rare, adding, "I only know of this happening two times in 40 years."
MESA, AZ. — Arizona grocery store chain Fry's has announced that they plan to add "fuel centers" to five of its stores here.
Service stations will be added to the Fry's locations at Stapley Drive and McKellips Road, Alma School Road and Main Street, and at Baseline Road and Country Club Drive as well as two additional sites yet to be determined.
Fry's currently operates 19 supermarket fuel centers in its Arizona stores and spokesman Kendra Doyel said the company is looking at adding another 20 fuel centers across the state, depending on available space at each store and neighborhood competition.
"It is a part of our growth and you will continue to see more of those with Fry's Food stores throughout the coming years," stated Doyel.
BURLEY, ID. — Pacific Ethanol has begun operations at its new 50 million gallon per year ethanol production plant here which, when at full capacity, could meet the ethanol needs of the entire state.
The 160-acre facility, which has been under construction since last February, will be the largest ethanol producing plant in the western United States.
The plant, which uses corn as its feedstock, has access to both the Union Pacific Railroad and Interstate 84. A fuel blending rack is located approximately eight miles from the plant site.
The Idaho plant can produce "what really amounts to a 10 percent boost in fuel supply and refining capacity in a state that has to import all of its transportation fuels right now. This is really a great deal for consumers, it's a great deal for the local economy and it's a great deal for the environment," said Tim Raphael, government affairs director for Pacific Ethanol.
As the corn will be brought through Burley and then in to the plant via railcar, Pacific Ethanol built 10,000 feet of railroad track around the facility with a plan to keep rail traffic flowing in the area while they unload the corn.
When the first batch of corn came in, it was on a 100 rail car unit train, recalled plant manager Lee Phillips, carrying approximately 400,000 bushels. "We unloaded that in about 9.5 hours, and normally it's about a 2.5 day process."
The time to unload the corn had been an issue of local concern as Burley City Councilman Dennis Dexter explained. The trains will stretch more than one-and-one-quarter mile, long enough to simultaneously block every railroad crossing in Burley — some for a shorter period of time than others — as they move to and from Pacific's plant. Dexter said the city is concerned blocked intersections may lead to intense traffic congestion and delayed response times for emergency services.
It is a two-day process to distill the corn into ethanol and Phillips noted that "for every 100 pounds of corn that we bring into the system, we will actually ship out 83 pounds of a wet distiller's grain for the local cattle market. When you make ethanol by weight you get 1/3 ethanol, 1/3 carbon dioxide, and 1/3 wet distillers grain, and all three of those are marketable, and sellable," said Phillips.
The Burley area has over 400,000 dairy and beef cattle which are expected to consume the plant's wet grains, transported to local feed lots by truck.
The Idaho Department of Commerce estimates the Burley plant will produce $7.2 million in additional household income for the residents of Cassia County.
Pacific Ethanol also operates a 40 million gallon per year ethanol production facility in Boardman, OR., a 40 million gallon plant in Madera, CA., and has a 50.0 million gallon per year facility under development in Stockton, CA.
Originally published in the June 2008 issue of O&A Marketing News.
Copyright 2008 by KAL Publications Inc.
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