Lyondell to begin closure of Houston Refinery this weekend

LyondellBasell Industries will begin the permanent closure of its 263,776 barrel-per-day Houston refinery this coming weekend, said people familiar with plant operations.

Layoffs of up to 400 employees at the refinery are scheduled to begin two months after the shutdown begins, the sources said.

A Lyondell spokesperson did not immediately reply to a request for comment.

Lyondell plans to convert existing hydrotreaters at the refinery site along the Houston Ship Channel for use with equipment to be added after 2027 to produce plastic pellets from recycled plastic items.

Lyondell said in November shuttering the refinery would begin in January and finish in February. The company plans to shut the first of two crude distillation units (CDUs) and associated coker in January. The second CDU, units fed by it and its associated coker, will shut between mid and late February.

Lyondell first announced plans to shut the refinery within a year in 2023, after failing in attempts over seven years to sell it, but extended the timing of the closure by a year to the first quarter of 2025.

The Lyondell plant is the first of two U.S. refineries planned for closure this year. Phillips 66PSX.N said in October it will shutter its Los Angeles refinery by the end of 2025.

Valero Energy VLO.N is reviewing the future of its two California refineries for possible closure, citing the state's plans to phase out sales of new gasoline-powered automobiles by the middle of the next decade.

Hydrotreaters use hydrogen to remove sulfur from motor fuels in compliance with U.S. environmental rules.

CDUs begin the refining of crude oil by breaking it down into feedstocks for all other units at the refinery. Cokers convert residual crude oil into either feedstocks for motor fuels or petroleum coke, a coal substitute.