$8 billion merger creates refining giant

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announced today that the companies have executed a merger agreement for Valero to acquire Premcor in an $8 billion transaction. As a result, Valero will add four refineries and 790,000 barrels per day (BPD) of throughput capacity to its system, making it the largest oil refiner in

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With this acquisition, Valero will have total assets of $25 billion and annual revenues of nearly $70 billion. Adding Premcor's refineries in Port Arthur, Texas; Memphis, Tennessee; Delaware City, Delaware; and Lima, Ohio will give Valero 19 refineries with a total throughput capacity of 3.3 million BPD.

"This transaction is one of the largest and most strategic acquisitions in Valero's history," said Bill Greehey, Valero chairman and chief executive officer. "We are acquiring several very strategic refineries for significantly less than their combined replacement value, and we'll be improving the profitability of these plants by improving their reliability and yields, and increasing their capacities.