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Phillips 66 Begins Phased Closure of LA Refinery in 2025
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Key Takeaways
Phillips 66 will permanently close its Los Angeles refinery in Q4 2025 after phased shutdowns.
Most of the 600 workers face layoffs in December, with limited transfers to a marine terminal.
The refinery and Valero's Benicia plant supply 20% of California gasoline, raising supply concerns.
Phillips 66 (PSX - Free Report) will begin winding down operations at its Los Angeles-area refinery this week, with permanent closure expected in the fourth quarter of 2025, per a Reuters report. According to the report, most employees and contractors will be laid off in December, following the company’s announcement last year to cease operations at the 139,000-barrel-per-day facility.
More than half of the 600 employees are represented by the United Steelworkers Union. A small number of workers may be transferred to the Phillips 66 marine oil terminal in Los Angeles. The company said that its commitment to supporting employees and contractors through the transition remains unchanged, but it has declined to comment on post-closure employment plans.
This refinery, along with Valero Energy Corporation’s (VLO - Free Report) 145,000-barrel-per-day Benicia facility, also set for shutdown, produces around 20% of California’s gasoline supply. The closures are expected to tighten fuel markets and may contribute to volatility in pump prices, as California relies more heavily on imports and alternative sources to meet demand.
The process of shutting down the refinery will be multi-phased and complex, involving environmental remediation and coordination with local agencies. Phillips 66 has stated that it will work with state officials to supply fuel and address the long-term fate of its strategically located properties near the Port of Los Angeles.
PSX’s Zacks Rank and Key Picks
PSX currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at a couple of better-ranked stocks like Precision Drilling Corporation (PDS - Free Report) , Antero Midstream Corporation (AM - Free Report) and Archrock, Inc. (AROC - Free Report) . While Precision Drilling sports a Zacks Rank #1 (Strong Buy) at present, both Antero Midstream and Archrockcarry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Precision Drilling is an oilfield services company. It provides contract drilling, well servicing and strategic support services to the oil and gas industry in North America and internationally. It provides land drilling, directional drilling, turnkey drilling, camp and catering services, and procures and distributes oilfield supplies.
PDS’ earnings beat estimates in two of the trailing four quarters and missed in the other two, delivering an average surprise of 977.7%. The Zacks Consensus Estimate for 2025 earnings indicates a 14.2% year-over-year decline.
Antero Midstream generates stable cash flow by providing midstream services under long-term contracts with Antero Resources. The company prioritizes debt reduction by effectively utilizing free cash flow after dividends. Antero Midstream’s higher dividend yield compared to its sub-industry peers reflects its commitment to generating shareholder returns.
AM’s earnings beat estimates in two of the trailing four quarters, met once and missed in the other, delivering an average surprise of 1.13%.
Archrock benefits from nearly full fleet utilization at 96%, indicating strong demand for its natural gas compression services and effective use of its high-cost equipment. The company’s recent acquisition of NGCS has expanded its large-horsepower asset base and improved customer relationships, boosting both scale and earnings potential. However, risks remain.
AROC’s earnings beat estimates in three of the trailing four quarters and met in the remaining one, delivering an average surprise of 6.50%.
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Phillips 66 Begins Phased Closure of LA Refinery in 2025
Key Takeaways
Phillips 66 (PSX - Free Report) will begin winding down operations at its Los Angeles-area refinery this week, with permanent closure expected in the fourth quarter of 2025, per a Reuters report. According to the report, most employees and contractors will be laid off in December, following the company’s announcement last year to cease operations at the 139,000-barrel-per-day facility.
More than half of the 600 employees are represented by the United Steelworkers Union. A small number of workers may be transferred to the Phillips 66 marine oil terminal in Los Angeles. The company said that its commitment to supporting employees and contractors through the transition remains unchanged, but it has declined to comment on post-closure employment plans.
This refinery, along with Valero Energy Corporation’s (VLO - Free Report) 145,000-barrel-per-day Benicia facility, also set for shutdown, produces around 20% of California’s gasoline supply. The closures are expected to tighten fuel markets and may contribute to volatility in pump prices, as California relies more heavily on imports and alternative sources to meet demand.
The process of shutting down the refinery will be multi-phased and complex, involving environmental remediation and coordination with local agencies. Phillips 66 has stated that it will work with state officials to supply fuel and address the long-term fate of its strategically located properties near the Port of Los Angeles.
PSX’s Zacks Rank and Key Picks
PSX currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at a couple of better-ranked stocks like Precision Drilling Corporation (PDS - Free Report) , Antero Midstream Corporation (AM - Free Report) and Archrock, Inc. (AROC - Free Report) . While Precision Drilling sports a Zacks Rank #1 (Strong Buy) at present, both Antero Midstream and Archrockcarry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Precision Drilling is an oilfield services company. It provides contract drilling, well servicing and strategic support services to the oil and gas industry in North America and internationally. It provides land drilling, directional drilling, turnkey drilling, camp and catering services, and procures and distributes oilfield supplies.
PDS’ earnings beat estimates in two of the trailing four quarters and missed in the other two, delivering an average surprise of 977.7%. The Zacks Consensus Estimate for 2025 earnings indicates a 14.2% year-over-year decline.
Antero Midstream generates stable cash flow by providing midstream services under long-term contracts with Antero Resources. The company prioritizes debt reduction by effectively utilizing free cash flow after dividends. Antero Midstream’s higher dividend yield compared to its sub-industry peers reflects its commitment to generating shareholder returns.
AM’s earnings beat estimates in two of the trailing four quarters, met once and missed in the other, delivering an average surprise of 1.13%.
Archrock benefits from nearly full fleet utilization at 96%, indicating strong demand for its natural gas compression services and effective use of its high-cost equipment. The company’s recent acquisition of NGCS has expanded its large-horsepower asset base and improved customer relationships, boosting both scale and earnings potential. However, risks remain.
AROC’s earnings beat estimates in three of the trailing four quarters and met in the remaining one, delivering an average surprise of 6.50%.