Phillips 66 announced Wednesday it will close its Los Angeles-area refinery next year, idling 600 employees and 300 contractors who work at two sprawling facilities that straddle Wilmington and Carson in the port region.
A statement cited uncertainty about the “sustainability” of the facility going forward.
“We understand this decision has an impact on our employees, contractors and the broader community,” Mark Lashier, chairman and CEO of Phillips 66, said in a statement. “We will work to help and support them through this transition.”
The refinery includes a crude-oil processing facility that operates on 235 acres in Carson and a separate 424-acre facility in Wilmington where the processed oil is finalized into “finished products.”
The two facilities are linked by a roughly five-mile pipeline.
Related Articles
Walters: What’s behind the political theater over California’s high gas prices?
California Democrats want to slash gas prices, a state climate policy will raise them
Gov. Newsom signs bill he says will help avoid gas price spikes
California Assembly passes measure aimed at easing gas price spikes
Skinner: Gasoline reserves can save us all money at the pump
“With the long-term sustainability of our Los Angeles Refinery uncertain and affected by market dynamics,” Lashier said, “we are working with leading land development firms to evaluate the future use of our unique and strategically located properties near the Port of Los Angeles.”
Phillips 66 — which operates 12 refineries across the United States and Europe — made $7 billion from its operations in 2023, according to a company report.
“Phillips 66 remains committed to serving California and will continue to take the necessary steps to meet our commercial and customer demands,” Lashier added.
Phillips plans to close the facility in the fourth quarter of 2025, but the company will “work with the state of California to supply fuel markets and meet ongoing consumer demand.”
“The company will supply gasoline from sources inside and outside its refining network as well as renewable diesel and sustainable aviation fuels from its Rodeo Renewable Energy Complex in the San Francisco Bay area,” according to Phillips.
The announcement, meanwhile, came just days after Gov. Gavin Newsom signed a new bill into law, which aims to prevent gas prices from spiking suddenly when refineries go offline for unplanned refinery outages.
That piece of legislation is just one of many energy-related bills Newsom has signed into law in recent months, all of which have been heavily opposed and criticized by the oil industry.
Newsom also a signed a trio of oil-related bills into law in September — all three of which aim to more strictly regulate oil drilling, abandoned oil well remediation, and the public health impacts of the oil industry on neighborhoods.
But Al Ortiz, a Phillips spokesperson, said in a Wednesday statement that the decision was not related to the new state legislation.
“The uncertainty is in reference to the refinery’s low profitability compared to other assets in our portfolio,” Ortiz said. “The timing of this announcement is based on consideration of multiple factors including the long-term sustainability of our Los Angeles Refinery and market dynamics, as well as future options for the site as part of Phillips 66’s ongoing review of its portfolio of assets.”
Ortiz also noted that Phillips doesn’t have any additional information to share about the property’s future just yet.
“We will have more information to share when that time comes,” Ortiz said. “In the meantime, we intend to work closely with our redevelopment firms and the local community to determine the best future use of this land that is appropriate given the site’s history.”
Some environmental advocates, meanwhile, were critical of the decision on Wednesday — and unsure whether the refinery’s closure will have positive impacts on the community later down the line.
“This is just most likely a strategic move for Phillips,” said Janet Gunter, an environmental activist in San Pedro. “No doubt another company will buy this and keep it in operation, which will not help the safety factor for residents.”
Gunter underscored that the refinery is in an earthquake rupture zone and on landslide and liquefaction areas.
“They may also use this to lobby against the much needed environmental regulatory controls,” Gunter added.
L.A. City Councilman Tim McOsker, whose district includes the Wilmington area, called the closure “significant,” but said it “opens the door to exciting opportunities for new jobs, improved air quality, and innovative economic benefits in the years to come.”
“Phillips 66 shared with me their commitment to assist their employees on this transition,” McOsker said in a statement. “I have also reached out to the city’s Economic and Workforce Development Department, and we are prepared to assist workers affected by this change. We will be working closely with Phillips 66, their employees, and our community to make sure that we’re supporting all who are impacted.”
County Supervisor Janice Hahn said a key priority moving forward will be supporting workers impacted by the refinery’s closure.
“We need to focus on these workers,” Hahn said in a statement. “I am going to direct our L.A. County Department of Economic Opportunity to work with these workers to connect them with job training and anything they need to get good paying new jobs.
Lucia Moreno-Linares of Wilmington, a former member of the Port of Los Angeles Harbor Commission, said the facility’s closure would certainly have “an impact” because Phillips is a major employer and fuel provider for the region.
“I can’t imagine all the ramifications there will be,” Moreno-Linares said. “I understand business decisions have to be made. I hope we can be a part of the winding down process.”
For Gina Martinez of the Wilmington Neighborhood Council, the news brought some mixed reactions.
“I really have ambivalent feelings,” she said. “It truly is the end of an era. The refinery has provided livelihoods for so many in the area for generations and they have been in the community for so long. I am concerned about any displaced workers and what resources will be available to them.”
But she added she was also “excited about what new economic opportunities will come to Wilmington as a result of the closure.”
The boys of Oct. are in full swing in Wilmington Monday Oct. 7, 2024 with the Union Oil Jack-O-Lantern and Dodgers jersey painted on 2 of the tanks at the Phillips 66 Refinery. (Photo by Chuck Bennett, Contributing Photographer)
There was also some nostalgia over what is something of a seasonal landmark in the Harbor Area: “I will miss Smiling Jack (a giant jack-o-lantern painted on a large tank every Halloween heralding the company’s candy giveaway) and that delicious caramel popcorn.”
Staff writer Donna Littlejohn, City News Service and the Associated Press contributed to this report.
