Valero Energy Corp. has decided to exit the nitrogen fertilizer business by shutting down Nitromite Fertilizer and permanently closing the former Diamond Shamrock anhydrous ammonia plants that Nitromite operates in Dumas, Texas.
The two aging ammonia facilities, both with capacity of roughly 225 st/day, came under Valero’s control when the company merged with Ultramar Diamond Shamrock Corp. in December 2001. One of the plants has been idled for years, while the other was idled in December 2005 due to high natural gas costs. Both plants were built in the 1960s.
Earlier this year, sources reported that Valero was planning to convert the long-idled ammonia plant at Dumas to a hydrogen plant for use at the company’s nearby McKee refinery. It was not clear last week if those plans were still in the works, or what was in store for the second ammonia production facility there.
The McKee refinery has approximately 430 employees, and produces various gasoline products, jet fuels, low-sulfur diesel, and asphalts. It has a total throughput capacity of roughly 170,000 barrels/day, and its location in the Texas panhandle gives it access to crude oil from northern Texas, Oklahoma, southwestern Kansas, and eastern Colorado.
The decision to suspend operations at Nitromite Fertilizer means that Perry White, general manager and an employee of the company since 1990, will be retiring at the end of July. Tim Crown, Nitromite sales manager, will be moving to another job with Valero. Zell Cain, scheduling manager for Nitromite, will also be retiring, as will Jimmy Cleveland, sales and credit manager.
Valero had not returned calls by press time, but it can be reasoned that the ammonia plants at Dumas, given their age, output capacity, and idled status, were of limited significance to the Fortune 500 refinery company. Based in San Antonio, Valero has approximately 22,000 employees and annual revenue of about $80 billion. The company owns and operates 18 refineries throughout the U.S., Canada, and the Caribbean, with a combined throughput capacity of roughly 3.3 million barrels/day, making it the largest refiner in North America.
Valero is also one of the nation’s largest retail operators, with more than 5,000 retail and branded wholesale outlets in the U.S., Canada, and the Caribbean under various brand names, including Valero, Diamond Shamrock, Shamrock, Ultramar, and Beacon.
Valero still has an ammonia connection through its general partner, Valero LP, which operates the 2,000-mile ammonia pipeline formerly owned by Koch Industries Inc. Valero LP acquired the pipeline, which stretches from Louisiana up into Arkansas, Missouri, Illinois, Indiana, Iowa, and Nebraska, when it purchased the Kaneb Companies on July 1, 2005.