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HESS EXPRESS, Walt Disney World, Florida
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| REFINING The HOVENSA refinery in the United States Virgin Islands is one of the largest refineries in the world. It is jointly owned by the Corporation and Petroleos de Venezuela (PDVSA). The facility is competitively positioned and enjoys significant economies of scale. Its strategic location in the Caribbean allows for short crude supply lines from Venezuela as well as easy access to U.S. product markets. The refinery, with 500,000 barrels per day of crude distillation capacity and a 150,000 barrel per day fluid catalytic cracking unit, is able to make a significant volume of high quality gasolines and distillates. In addition, the refinery has a 58,000 barrel per day delayed coking unit, which allows the refinery to process lower cost heavy crude oils. Gross crude runs at the refinery averaged 484,000 barrels per day in 2004. This high level of capacity utilization allowed HOVENSA to take advantage of the strong refining margin environment, resulting in a solid year of financial performance. The Corporation also operates a fluid catalytic cracking unit in Port Reading, New Jersey, which produces clean-burning gasoline and heating oil for markets in the northeast. The facility averaged feedstock runs of approximately 52,000 barrels per day and benefited from strong product margins in 2004. Both the HOVENSA and Port Reading facilities are making the necessary investments to meet U.S. low sulfur fuel requirements. RETAIL MARKETING The HESS retail network continues to expand, further solidifying our position as the leading independent gasoline convenience store marketer on the East Coast. In 2004, five new retail locations were built and 12 existing retail sites were upgraded with the addition of HESS EXPRESS convenience stores. In October, we acquired an additional 20 facilities in New England and upstate New York. Rebranding of all sites to the HESS brand will be completed by the second quarter of 2005. The Corporation plans to continue this opportunistic growth through selective acquisitions and new site developments in key East Coast markets. HESS EXPRESS stores continue to outpace industry averages in gasoline volumes and convenience store sales. The Corporation has entered into a long-term partnership agreement with Walt Disney World in Orlando, Florida. HESS has been designated “Official Fuel Supplier”of Walt Disney World and has taken over operatorship of three gasoline retail sites adjacent to major Disney attractions. Conversion of these sites to the HESS brand was completed in the first quarter of 2004 and initial sales performance from these outlets is encouraging. ENERGY MARKETING The Corporation is a major supplier of natural gas, fuel oil and electricity to commercial and industrial customers located primarily on the East Coast. In addition, Hess is a supplier of natural gas to several local distribution companies in this region. We will continue to look for growth opportunities in our marketing areas. SUPPLY & TERMINALS Amerada Hess operates twenty-two strategically located petroleum terminals on the East Coast of the United States that provide economical and secure supply to our marketing operations. During a series of devastating hurricanes in the fall of 2004, the Corporation maintained supply to our branded outlets and to emergency relief agencies. |
Delayed Coking Unit, St. Croix, Virgin Islands.
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