UPDATE 1-Court approves Bakersfield refinery sale

Wed Mar 24, 2010 5:41pm EDT

* Alon plans to ship gasoil from Bakersfield plant

* Sale one of several divestitures by Flying J

HOUSTON, March 24 (Reuters) - A U.S. bankruptcy court in Delaware approved the sale of a shuttered refinery in Bakersfield, California, to Alon USA Energy (ALJ.N) subsidiary Paramount Petroleum Corp, an Alon executive said on Wednesday.

The 68,000 barrel per day (bpd) Big West refinery was shut in 2009, after corporate parent Flying J Inc filed for bankruptcy in December 2008.

Alon was the sole bidder for the plant, offering $40 million plus an amount equal to the inventory on hand.

"We are pleased to pursue the purchase of the Bakersfield refinery, as an alternative solution to convert our vacuum gas oil production into gasoline and distillate products, in the California market," said Alon Chief Operating Officer Joseph Israel in statement.

The refinery sale is one of several asset divestitures privately-held Flying J is undertaking to pay off its senior creditors, according to a plan filed earlier this year with U.S. Bankruptcy Court in Delaware.

Alon plans to send gasoil, an intermediate feedstock, to the Paramount refinery, which is in the Los Angeles suburb of Paramount, California.

No closing date for the sale has been set, Israel said. (Reporting by Erwin Seba, Editing by Rene Pastor)

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