* Q2 EPS $1.30 vs Street view $1.44
* Shares edge lower
* Eagle Ford crude runs headed higher (Adds details from conference call, byline)
By Anna Driver
HOUSTON, July 26 (Reuters) - Oil refiner Valero Energy Corp’s (VLO.N) quarterly profit rose but fell short of expectations, hurt by downtime at some of the company’s U.S. Gulf Coast plants and weakness at a plant in Canada.
Power outages at the company’s Texas City plant, problems in Corpus Christi and a lightning strike at its plant in Port Arthur cut into Valero’s second-quarter profit.
The company’s refinery in Quebec also fared worse than expected as it processed more expensive crude oil, analysts said.
“Gross margin in the company’s Northeast operation, which now consists of just the Quebec refinery, were just about $3 per barrel, reflecting the challenges of a market competing for only light seaborne crudes on the Brent pricing scale,” Sam Margolin, an analyst at Dahlman Rose, said in a note to clients.
Challenges for the region’s results were more pronounced than expected, he said.
For the second quarter, net income rose 28 percent to $744 million, or $1.30 per share, from $583 million, or $1.03 per share.
Analysts had expected a profit of $1.44 per share, according to Thomson Reuters I/B/E/S.
Rising global demand for fuels fattened Valero’s refining margins and the company benefited from processing cheaper crude oil from oversupplied Midwest markets, a situation that is expected to last for at least 18 months to 2 years, the company said on a conference call.
Valero also plans to increase runs of less-expensive crude oil produced in the Eagle Ford Shale in South Texas at its Gulf Coast refineries, the company told analysts. [ID:nWEN6120]
Margins in the third quarter have increased from the second quarter and Gulf of Mexico export markets are expected to remain robust for the foreseeable future.
Operating revenue rose 52 percent to $31.29 billion.
Valero’s shares fell 14 cents to $26.54 in early afternoon New York Stock Exchange trading. (Additional reporting by Kristen Hays in Houston; Editing by Derek Caney, Maureen Bavdek and Richard Chang)