By Kristen Hays
HOUSTON, May 1 The CEO of Phillips 66,
the newest U.S. independent refiner, said on Tuesday it aims to
process more shale oil "everywhere we can get it."
"We want to increase our exposure in both the West Coast and
East Coast for some of those advantaged barrels," Greg Garland
told Reuters in an interview on the company's first day as a
pure-play refining, midstream and chemicals company split off
That includes more rail unloading, rail cars and storage to
facilitate, in the medium term, movement of cheaper inland crude
to coastal markets until more pipelines are built to alleviate
bottlenecks, he said.
Phillips 66 is the only refiner that has plants in all U.S.
Garland noted several refineries are already well positioned
to receive shale oil, such as its 247,000 barrels-per-day (bpd)
refinery in Sweeny, Texas, in proximity to the state's prolific
Eagle Ford shale play, or Midwest plants.
The company last fall also ran unit trains from the Bakken
shale oil play in North Dakota to its 238,000 bpd Bayway
refinery in Linden, New Jersey, and has taken trains to West
"You'll see us stepping out and doing some more things
around infrastructure," he said. "Like everyone else, we're
doing everything we can to get more barrels in front of those
Phillips 66 aims to double refined product exports to
200,000 bpd in the next two years, but its 247,000 bpd Alliance
refinery in Belle Chasse, Louisiana -- which runs light-sweet
crude -- is on the block.
Increasing U.S. light-sweet inland shale oil output along
with more infrastructure to move it to the refinery-heavy Gulf
Coast means more advantaged crude prices could show up in the
region in the coming years, increasing Alliance's value, Garland
said. If the price isn't right for what he called "a good export
platform for us," Phillips 66 will keep it, he said.
"We wouldn't let the refinery go cheap," he said.
Garland said he was pleased with the sale announced on
Monday of Phillips 66's 185,000 bpd Trainer, Pennsylvania,
refinery to Delta Air Lines Inc for $150 million plus a
$30 million in state assistance.
"We think Delta's a reputable buyer. They know how to manage
and run complex businesses," Garland said.
However, the company aims to keep the Bayway plant and its
foothold in the East Coast refining market.
"It's a good machine. It should be the last refinery
standing in PADD I," he said.
Phillips 66 is not actively seeking acquisitions of
refineries or other assets, and instead is focused on growth in
its midstream, transportation, logistics and chemicals
"You never say never, there may be some point in the future
when we might want to do that," Garland said. "I don't see us
right out of the gate thinking about acquisitions."