A bit off from our normal topic, but I was quite surprised to hear this morning that the Conoco-Phillips refinery, which has been up for sale, found a buyer, and that buyer is Delta Airlines. The refinery has pipelines going to Philly, JFK and LaGuardia, two of which are Delta hubs. Delta claims this will supply 80% of their domestic fuel needs. Wow. If this works, I wonder if you’ll see other airlines buying their own refineries. Apparently they also have a deal with BP to swap non-jet fuel products for more jet fuel, given that you can’t take crude and make exclusively jet fuel.
It’s partially a fractional distillation process, and you get what’s in the crude, essentially. You can crack your way to lighter hydrocarbons, but can’t go from lighter to heavier. The local angle is, the folks who worked at those refineries will get to stay in business. As the article mentions, refineries have been closing in this area because they are meant to take more expensive sweet crude, and find it difficult to compete with refineries who can deal with heavier, cheaper crude. So what Delta is attempting here is a bit of a risk.