Phillips 66 to Close South Bay Refineries on 650 Acres

Phillips 66 will close a pair of century-old refineries in Wilmington and Carson, opening hundreds of acres at the industrial sites for development.

The Houston-based energy firm announced it would shut down the 659-acre facility linked by a five-mile pipeline at 1660 West Anaheim Street in Wilmington and 1520 East Sepulveda Boulevard in Carson, the Los Angeles Times and Long Beach Press-Telegram reported.

The closure planned for the end of next year near the L.A. and Long Beach ports represents shifts driven by climate change, a transition to electric vehicles and demands for cleaner air. Some 600 workers and 300 contractors will be laid off.

The Phillips 66 refinery includes a crude-oil processing plant on 235 acres in Carson and a 424-acre facility in Wilmington where the oil is fashioned into “finished products.”

The Carson plant was built in 1923 and the Wilmington plant was built in 1919. Among the company’s other operations are its network of 76-branded gas stations.

The company said it has hired Catellus Development, based in Emeryville, and Deca Companies, based in San Francisco, to look at future uses for the 659-acre sites.

David Hackett, chairman of Stillwater Associates, an oil consultancy based in Irvine, said he was contacted by Phillips just prior to the announcement, and was told the closure was a business decision.

While the timing was somewhat surprising, he said the closure wasn’t surprising — given the age of the refineries, their relatively small size and an inefficient layout that connected them by a pipeline.

“That plant has been for sale for years,” Hackett told the Times. “It hasn’t found any buyers and I think that this has been an economic decision on their part. They looked at the profitability of the place and compared with the other other businesses that they have, and it didn’t make the cut.”

An asking price for the refineries was not disclosed.

The closure announcement came days after Gov. Gavin Newsom signed a new bill into law to prevent gas prices from spiking when refineries go offline for unplanned refinery outages. While some blamed the bill for the closure, Phillips 66 said its decision had nothing to do with it.

New uses for the industrial property would certainly be less intensive than refining oil, real estate experts said. Broker Mike Condon Jr. of Cushman & Wakefield helped manage the process of selecting a development partner for Phillips 66.

“Historically, the South Bay industrial real estate market has been extremely tight and this will allow a ton of new inventory and capacity that should help the market by providing more warehouse and distribution space” around the Port of Los Angeles, Condon told the Times.

— Dana Bartholomew