Damaged Philly refinery gives workers a 6-week extension to prepare ‘for a possible sale or restart’

Philadelphia Energy Solutions on Wednesday extended the termination date of about 950 refinery employees from July 12 to Aug. 25 to allow the company to better prepare the fire-damaged property for resale or a restart.

The company told leaders of United Steelworkers Local 10-1 during a bargaining session Wednesday that it would delay the plant’s termination date by about six weeks. U.S. Sen. Bob Casey’s office was first to announce the decision to the public.

Cherice Corley, a spokeswoman for PES, confirmed the reprieve.

“The reason for this extension is that PES is continuing its efforts to secure the facility in anticipation of potentially rebuilding the damaged infrastructure and preparing for a possible sale or restart,” she said in a text message.

Five days after the refinery suffered a devastating fire, PES abruptly notified its 1,100-member workforce on June 26 that it would shut down the East Coast’s largest refining complex on July 12. About 150 salaried workers were let go effective Monday, but much of the workforce was to remain on the payroll until July 12 to shut down the plant, which can process 335,000 barrels of crude oil a day.

The announcement comes as public officials, labor leaders, and the refinery’s former chief executive are scrambling to assemble some kind of effort to rescue the refinery, which emerged from bankruptcy last year under bank ownership, only to stagger again under heavy debt and unfriendly market conditions.

In a letter to the Steelworkers on Wednesday, a refinery executive said that PES is continuing to pursue opportunities to restart the refining complex.

“At this time, however, we have no additional information beyond this new termination date,”said William A. Goodhart, senior vice president of human resources. "After that date, the layoffs are expected to be permanent.”

The site is polluted from more than a century of refining, and experts say it would not be easily repurposed to a nonindustrial use, though green activists have pressured the city to turn some or all of the land into a park.

The PES site has extensive infrastructure that would be valuable to other energy-related enterprises, including pipelines and storage facilities, docks, and rail loading terminals.

Philip Rinaldi, the former refinery chief executive who oversees a group of investors who own about 4 percent of the refinery, said Tuesday that the plant has a “very bright” future. He said the plant could still operate as a refinery, though as a business, the South Philadelphia refinery has struggled through much of the last decade to be profitable.