Valero Energy Corporation - Introduction

Introduction

One Valero Way
San Antonio, Texas 78249-1112
U.S.A.
Telephone: (210) 246-2000
Toll Free: (800) 531-7911
Fax: (210) 246-2646
Web site: http://www.valero.com

Public Company
Incorporated: 1980
Employees: 19,797
Sales: $54.62 billion (2004)
Stock Exchanges: New York
Ticker Symbol: VLO
NAIC: 324110 Petroleum Refineries; 422710 Petroleum Bulk Stations and Terminals; 424720 Petroleum and Petroleum Products Merchant Wholesalers (Except Bulk Stations and Terminals); 447110 Gasoline Stations with Convenience Stores; 447190 Other Gasoline Stations; 454311 Heating Oil Dealers

Valero Energy Corporation is the leading independent oil refiner in the United States. The company owns and operates 15 refineries with a combined capacity of 2.5 million barrels per day. About 60 percent of this capacity is in the Gulf Coast region through refineries in Texas, Louisiana, and Aruba. The remaining refineries are on the West Coast, the Mid-Continent region, and in the Northeast. Valero also markets refined products on a wholesale basis through a bulk and rack marketing network and via more than 4,700 retail sites branded as Valero, Diamond Shamrock, Ultramar, Beacon, and Total. About 1,500 of the retail sites are company-operated outlets combining a fuel station with a convenience store. Valero's marketing reach extends to 40 U.S. states, Canada, Latin America, and the Caribbean region. The company also owns a 46 percent interest in Valero L.P., a publicly traded limited partnership that owns and operates crude oil and refined product pipelines, refined product terminals, and crude oil storage facilities mainly located in Texas, Oklahoma, New Mexico, Colorado, and California.

Valero Energy was founded as a natural gas pipeline on the first day of 1980. In an effort to diversify itself into a broad-based energy firm, the company purchased a petroleum refinery shortly after its inception. Renovation and start-up of this facility in a difficult world petroleum market nearly put Valero out of business. The company subsequently sold off its natural gas properties to a limited partnership to retain financial stability and concentrate on its refining activities. Conditions in the petroleum industry repaid this gamble, and Valero Energy thrived in the late 1980s and early 1990s. From there, the Valero of the early 21st century was largely engineered through acquisitions. From 1997 to 2004 the company acquired 14 of the 15 refineries it now operates. The biggest of these deals came in December 2001 when Valero bought Ultramar Diamond Shamrock Corporation for about $6 billion in cash, stock, and assumed debt, thereby gaining six refineries and vastly enlarging its retail operations.