May 16, 2013 / 7:39 PM / 4 years ago

UPDATE 1-Tesoro may own BP Calif. refinery as early as June 1 -sources

3 Min Read

* Deal will make Tesoro second-largest Calif. refiner

* BP Arco station owners told sale could happen by June 1

By Erwin Seba

HOUSTON, May 16 (Reuters) - Independent western U.S. refiner Tesoro Corp may take ownership of BP Plc's 240,000 barrel per day (bpd) Carson, California, refinery as early as June 1, sources familiar with the transaction said on Thursday.

When the $2.5-billion sale is complete, including an 800-station retail network and distribution and storage assets, Tesoro will become the second-largest refiner in California, the nation's largest gasoline market.

BP's U.S. downstream operation will then be solely focused on refineries in the northern continental United States, where cheaper Canadian crude oil is easily obtained.

In recent days, owners of BP Arco branded retail stations in California have been notified to expect the change to Tesoro as early as the first day of June.

"June 1, that's the date for Tesoro to take over," one of the sources said.

A BP spokesman declined to discuss the transaction, which was first announced in August last year and has been awaiting approval from the U.S. Federal Trade Commission and the California attorney general's office.

A Tesoro spokeswoman declined to discuss the status of the deal.

"As previously communicated, we expect the transaction to close before mid-2013," said Tina Barbee. "We do not have additional details to share at this time."

An FTC spokesman declined on Thursday to discuss the status of the commission's review of the transaction. On May 2, Tesoro Chief Executive Greg Goff said the company was near the end of the regulatory review process.

A spokeswoman for California Attorney General Kamala Harris did not have an immediate comment about the pending sale.

In addition to the refinery and retail network, the sale includes more than 100 miles of pipeline, three marine terminals, four land storage terminals and four product marketing terminals.

Tesoro plans to sell the distribution and storage assets to its master limited partnership, Tesoro Logistics LP, for about $1 billion, within a year of closing.

Tesoro plans to combine operations of the Carson refinery with its 103,800 bpd Wilmington, California, refinery. The two refineries nearly abut one another in the Los Angeles industrial suburbs north of the port of Long Beach.

BP announced plans to sell the Carson refinery as well as its Texas City, Texas, refinery in 2011. Marathon purchased the Texas refinery in February as part of a $2.4-billion deal that includes terminals, pipelines and other assets.

Chevron Corp is the largest refiner in California, according to Energy Information Administration data.

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