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Lay-offs at Motiva project while construction continues

Published December 24, 2008 04:10 pm – According to Verna Rutherford of Motiva, changes are being implemented to assure tighter control of costs on the $7 billion refinery expansion project that began December 2007. Demand for Motiva’s products is down, and with lower demand, margins are also down, making tight cost control essential. 

By David Ball 
The Port Arthur News 

PORT ARTHUR —

A not-so-welcomed Christmas gift for workers and the community was announced on Christmas Eve by Motiva Enterprises.

According to Verna Rutherford of Motiva, changes are being implemented to assure tighter control of costs on the $7 billion refinery expansion project that began December 2007. Demand for Motiva’s products is down, and with lower demand, margins are also down, making tight cost control essential.

The resulting downside are fewer contractual workers on the job for the next several months was cost analysis are evaluated. The bright side is the construction will continue and the project has made a significant economic impact in the area, Rutherford said.

“Construction will continue and we’re moving forward. We’re performing cost review on the project with tighter control,” she said. “There’s been lay-offs of contractual workers to ensure the workforce is at the appropriate level for construction levels. We’ll have a clearer path for the second quarter of 2009 (in the late spring). We’ll have confirmed information.”

Rutherford said it was a combination of issues why the company is doing the cost analysis — the overall economy and the response and demand of products are down as well as margins are down.

“We don’t know where this will end up. But a lot of work has been done and a huge economic impact has already hit the area. Adjustments are being made now,” she said. “We’re optimistic the project is continuing. The good news is we’re having an economic impact. It’s too early to tell.”

ARTICLE ENDS

SOURCE ARTICLE

Motiva Enterprises LLC is a joint venture formed in 1998. The current owners are Saudi Refining, Inc. and Shell.
Shell Oil Company is an affiliate of Royal Dutch Shell plc, a global energy and petrochemical company operating in more than 110 countries and territories, with approximately 24,000 employees based in the United States. Shell Oil Company, including its consolidated companies and its share in equity companies, is one of America’s leading oil and natural gas producers, natural gas marketers, gasoline marketers and petrochemical manufacturers. Shell, a leading oil and gas producer in the deepwater Gulf of Mexico, is a recognized pioneer in oil and gas exploration and production technology.

Saudi Refining, Inc. (SRI), with headquarters in Houston, is a subsidiary of Aramco Services Company (ASC) that purchases and sells crude oil and maintains a significant inventory of crude oil outside the United States. Aramco Services Company (ASC) is a wholly-owned subsidiary of Saudi Arabian Oil Company (Saudi Aramco), the national oil company of Saudi Arabia. ASC has a contract with its parent company under which it provides a wide range of services through six departments operating out of its headquarters in Houston, Texas, and an office in Washington, D.C.

Business Headquarters

Motiva Enterprises LLC
700 Milam Street
Houston, TX  77002

713-277-8000

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