DALLAS, June 2 /PRNewswire-FirstCall/ -- Alon USA Energy, Inc. (NYSE: ALJ) (the "Company") announced today that it has completed the acquisition of the Bakersfield, California refinery from Big West of California, LLC, a subsidiary of Flying J Inc.
Jeff Morris, Alon's CEO, commented, "The Bakersfield refinery, which is being acquired at a very attractive price, avoids hundreds of millions of dollars in anticipated costs to construct a hydrocracker for our California refineries, and will enable us to operate it as an integrated unit with our Paramount refinery, allowing us to significantly increase throughput at our California refineries and increase West Coast refining margins by processing vacuum gas oil from our Paramount refinery at Bakersfield. Additionally, we were able to accomplish the acquisition of substantially all of the assets of Big West without incurring additional debt to Alon or its subsidiaries."
"We are very pleased to have the opportunity to join ranks with a strong group of employees, which we believe will facilitate the integration of the Bakersfield refinery into our refinery portfolio under our current corporate infrastructure. Our acquisition of Bakersfield will allow us to potentially save up to 100 jobs in the Bakersfield area once the refinery has recommenced full operations."
The Company anticipates using certain equipment from Bakersfield at its other refineries while processing vacuum gas oil from its refinery in Paramount, California at the Bakersfield refinery. The purchase price of the Bakersfield transaction, including substantially all of the assets of Big West, consists of $40 million in cash. The Company also acquired the Bakersfield refinery's existing inventory as of the closing date of the transaction.
The Bakersfield refinery is located in California's Central Valley and has the capacity to refine up to 70,000 barrels per day of crude oil. The refinery is supplied by crude oil produced in the San Joaquin Valley with its products marketed in California, and is a major provider of motor fuels in central California.
Any statements in this press release that are not statements of historical fact are forward-looking statements. Forward-looking statements reflect our current expectations regarding future events, results or outcomes, including expectations regarding results of the acquisition, operations of the Bakersfield refinery and employment opportunities within the Company. These expectations may or may not be realized. Actual results could differ materially from those expressed in the forward-looking statements contained in this press release because of a variety of factors, including changes in market or other conditions affecting operations of the Bakersfield refinery following the acquisition. In addition, our business and operations involve numerous risks and uncertainties, many of which are beyond our control, which could result in our expectations not being realized or otherwise materially affect our financial condition, results of operations and cash flows. Additional information regarding these and other risks is contained in our filings with the Securities and Exchange Commission.
Claire A. Hart, Senior Vice President
Alon USA Energy, Inc.
Investors: Jack Lascar/Sheila Stuewe
DRG&E / 713-529-6600
Media: Blake Lewis
Lewis Public Relations
SMG Public Relations
SOURCE Alon USA Energy, Inc.