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Big West lays off 55 workers amid financial turmoil
[January 08, 2009]

Big West lays off 55 workers amid financial turmoil


(Bakersfield Californian, The Via Acquire Media NewsEdge) Jan. 8--About 55 contracted workers at Big West refinery have lost their jobs because of problems stemming from the plant owner's recent bankruptcy filing, a union official briefed on the situation said Thursday.



The laid-off workers were doing upgrades and maintenance work, said the official, Ed Huhn, secretary-treasurer of the local chapter of United Steelworkers of America, which represents many employees at the Rosedale Highway refinery.

Last year the plant employed about 150 part-time workers in addition to some 200 full-timers. Huhn said no salaried workers were affected by the cutbacks.


"As of right now they have not laid off any of their permanent help," he said.

The refinery's Ogden, Utah-based owner, Flying J Inc., did not respond to requests for comment.

A company that Huhn said provided some or all of the now-dismissed contracted workers, Total Western Inc., declined to comment on the layoffs, and instead referred calls to a lawyer who could not be reached for comment.

Since Flying J's Chapter 11 bankruptcy reorganization filing Dec. 22, Big West has had trouble buying enough crude oil to continue operating. Some oil companies large and small have stopped selling to the refinery, saying they want to be paid promptly for past and future shipments.

A company spokesman said last week that the plant had ceased operating for 10 days of maintenance work, a move some say was done earlier than planned and may have been forced by the oil supply problems.

In other refinery-related developments, Huhn said:

--Big West will run at a minimum level of output when it resumes refining later this month. That's because Flying J has stockpiled some oil -- more than 100,000 barrels -- but still struggles to secure an adequate crude supply.

--Refinery managers blame Shell Oil Co., the refinery's former owner, for much of the trouble. They say the company has shut off a pipeline that delivers not only its own oil, but also that of other producers that want to sell crude to the plant but cannot do so without access to Shell's pipeline.

Shell spokeswoman Alison Chassin denied that the company is holding up refining activity at Big West. She said the company's pipeline is one of two that bring oil to the refinery, and that the other one would be "equally available to supply a majority of the oil" to the plant.

Moreover, she said Shell's pipeline normally supplies the refinery with no more than about 10,000 barrels of oil a day, which represents only about 20 percent of the refinery's needs, depending on its operating level.

And at any rate, she said, the payment terms requested by Shell, which she declined to discuss, are not extraordinary.

"We believe the terms we have been negotiating have been extremely reasonable given Flying J's bankruptcy status," Chassin said.

Big West provides about 2 percent of California's gasoline and 6 percent of its diesel under normal circumstances. It can process a maximum of about 65,000 barrels of oil daily, but can run on as little as about 35,000.

Local petroleum executives said Wednesday that the plant was continuing to sell regular unleaded gasoline produced prior to the shut down, but that it has run out of diesel and premium gas.

To see more of The Bakersfield Californian, or to subscribe to the newspaper, go to http://www.bakersfield.com.

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