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Company History
In 1980, Valero was a regional energy company with total assets just shy of $800 million, operations solely in Texas and less than 1,600 employees on its payroll. Today, Valero has annual revenues of $119 billion, and 16 refineries, seven ethanol plants and approximately 5,800 retail and branded wholesale locations across North America. Valero is the 10th largest company on the Fortune 500 list, with about 22,000 employees.
In addition, Valero has a combined refining throughput capacity of approximately 3 million barrels per day (BPD), making it not only the largest refiner in North America, but also the most geographically diverse and one of the most complex refining systems among all U.S. refiners.
Being a good operator also means being a good employer and neighbor. Employees are Valero's No. 1 asset. Plus, the company demonstrates its commitment to all of its communities through a variety of philanthropic efforts, volunteer activities and educational support programs.
Because of Valero’s commitment to safety, its employees and its communities, the company has been ranked No. 1 among the world's refining and marketing companies at the Platts Top 250 Global Energy Company Awards and No. 1 on Fortune magazine’s listing of the nation’s Best Big Companies to Work For, as well as ranked among the nation’s best employers on Fortune magazine’s listing of the 100 Best Companies to Work For -- for nine years.
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On Jan. 1, 1980, Valero was born as the corporate successor of LoVaca Gathering Co., a natural-gas gathering subsidiary of the Coastal States Gas Corp. The company’s formation was far from a smooth one. LoVaca and Coastal had contracts to supply natural gas to utilities around Texas. Due to the natural-gas shortage in the 1970s, LoVaca was unable to honor its contracts. After more than six years of litigation, a $1.6 billion settlement was reached, which included the formation of Valero as a new company separate from Coastal. At the time, it was the largest corporate spinoff in U.S. history. |
The original Saber refinery near the site of Valero’s flagship refinery complex in Corpus Christi started as nothing more than a vacuum and crude unit on a humble plot of land. Today, the sprawling Bill Greehey West and East refineries in Corpus Christi are among the most complex, technologically advanced refineries in the world.
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Throughout the late 1980s and early 1990s, Valero continued to grow as a diversified energy company, operating in refining and marketing and natural-gas-related services.
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Valero acquired Basis Petroleum Inc. in 1997, making it the largest independent refining and marketing company on the Gulf Coast.
Valero at that point had four refineries in Texas and Louisiana and a 530,000 BPD total throughput capacity.
Earlier that year, Valero announced that it would merge its natural-gas-related services with PG&E Corp., as well as spin off its refining and marketing operations as a new company retaining the Valero name. |
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Valero acquired Mobil’s Paulsboro refinery, making Valero the nation’s second-largest independent refining company with a total throughput capacity of approximately 735,000 BPD. The acquisition also provided the company with geographic diversity and access to Northeastern markets. |
In 2000, Valero entered the West Coast market when it acquired the Benicia refinery, which is considered one of the most complex refineries in the nation. With the acquisition of the former ExxonMobil Corp.’s refinery, located near
San Francisco, Valero also acquired its 270-store retail distribution chain and 80 company-operated sites. This marked the company’s entry into the retail business when it debuted the Valero retail brand. |
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Valero executed lease agreements with purchase options for a 115,000 BPD refinery in Corpus Christi and refined-product pipelines and terminals in Texas, which were owned and operated by subsidiaries of El Paso Corp. Also that year, Valero acquired Huntway Refining Co., which had two asphalt refineries on the West Coast -- one in Benicia, Calif., and one in Wilmington, Calif. -- near the company’s fuel refineries.
Valero completed its largest transaction when the company acquired Ultramar Diamond Shamrock in 2001. With this acquisition -- which was completed in seven months -- Valero became one of the nation's top three refining and marketing companies.
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Valero acquired Orion Refining Corp.'s St. Charles, La., refinery in July 2003. This was a key addition to Valero's refining network because the facility is another of the nation's most-complex refineries, yet still has tremendous upgrade potential. That means Valero can significantly enhance the plant’s profitability and performance with minimal capital investment.
The purchase also proved the company’s ability to turn a low-performing refinery into a profitable, community-focused plant. Under Valero’s ownership, the refinery produced a record-breaking United Way campaign, donating monies and volunteering time to charities in the community.
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Valero's international reach expanded in 2004 with the purchase of El Paso Corp.'s 315,000 BPD refinery on the Caribbean Island of Aruba. The refinery has excellent logistics, processes a heavy sour crude oil and strengthens Valero's geographic and feedstock diversity. The $465 million deal included other assets, such as a marina. |
A milestone year of growth, 2005 marked Valero's rise to become the largest North American refiner with the aquisition of Premcor Inc. After adding Premcor's four refineries in Port Arthur, Texas; Memphis, Tenn.; Delaware City, Del.; and Lima, Ohio, Valero had 18 refineries and a total throughput capacity of approximately 3.3 million barrels per day. This $8 billion transaction was one of the largest and most strategic acquisitions in the company's history.
Photo caption: To keep its competitive advantage over other refiners, Valero has acquired facilities and upgraded them. For example, the Port Arthur refinery -- part of the Premcor acquisition in 2005 -- became Valero's most profitable plant in 2006, and with expansions has allowed the processing of an additional 325,000 barrels per day of medium and heavy sour crude. |
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On Jan. 1, 2006, Bill Klesse was named the Chief Executive Officer of Valero Energy Corporation and Vice Chairman of the Valero Board of Directors.
In August, Valero became the No. 1 rack fuel marketer in Texas with a total of 1,900 branded wholesale and company-owned locations and significant unbranded sales volumes around the state.
This growth accurred when Valero signed an 11-year agreement with Susser Petroleum -- the largest single branded wholesale deal in Valero history in terms of both fuel volumes and number of sites -- to supply fuel and brand programs to more than 300 of Susser's network of 324 retail stores in Texas and Oklahoma. Valero also began branding selected sites from Susser's network of 352 wholesale dealers.
Valero was also named 2006 Convenience Store Chain of the Year by Convenience Store Decisions magazine, a widely read retail industry trade publication.
In December, Valero completed sale of its ownership interest in Valero GP Holdings, LLC, successfully spinning off Valero L.P. and its general partner, Valero GP Holdings. By making the companies independent, both Valero Energy and Valero L.P. were in a good position to continue growing. |
For the ninth year, Valero is ranked as one of Fortune magazine's 100 Best Companies to Work For. The company also earned accolades as one of the nation's Best Big Companies to Work For. |
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Valero enters the ethanol business with the purchase of seven ethanol plants and one site under development from VeraSun Energy Corp. With this purchase, a new subsidiary is formed. These ethanol plants are in Albert City, Charles City, Fort Dodge and Hartley, Iowa; Welcome, Minn.; Aurora, S.D.; and Albion, Neb. The site in Reynolds, Ind., is under development.
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