State and federal authorities cleared the way Friday for Tesoro Corp. to buy BP's Carson refinery, the Arco brand and other assets, and the Texas oil giant agreed to California restrictions on prices, jobs and retrofits to protect the environment.
The $2.5-billion deal, cut in the aftermath of the BP oil drilling disaster in the Gulf of Mexico, could be completed as early as June 1.
Under the deal with the California attorney general's office, Tesoro agreed to maintain the 1,000 jobs at its Wilmington refinery for the next two years.
Tesoro, not known for cheap fuel, also agreed to keep Arco as the low-cost fuel provider in California and to safeguard against price spikes in gasoline from refinery outages. And Tesoro agreed to retrofit the Wilmington and the Carson refineries to reduce greenhouse gas emissions.
“These commitments will protect jobs for potentially thousands of Californians, ensure that California’s oil and gas markets remain competitive for years to come and lead to a reduction in greenhouse gases and emissions,” state Atty. Gen. Kamala Harris said.
Both her office and the California Energy Commission will monitor Tesoro's operations to ensure compliance with the requirements for gas pricing, volume and refinery capacity.
Separately, the Federal Trade Commission also cleared the acquisition Friday, but with no conditions. It said that recent trends in the industry left the commission "without a reason to believe this transaction is likely to substantially lessen competition."
The FTC pointed out that the deal doesn't change the number of competitors on the West Coast, noting that "seven major refiners supply the West Coast today and will continue to do so after the acquisition."