Valero to shut down Benicia refinery after more than two decades

BENICIA - Valero announced this week that it will close its refinery in Benicia by mid-2026 following the city’s adoption of an ordinance regulating businesses like the refinery.

Valero Energy Corporation said in a press release this week that it has submitted notice to the California Energy Commission of its intent to idle, restructure or cease refining operations at the Benicia Refinery by April 2026. 

Valero CEO, president and chairman Lane Riggs acknowledged that the refinery’s closure heavily impacts the region. “We understand the impact that this may have on our employees, business partners, and community, and will continue to work with them through this period,” Riggs said in a statement Wednesday.

Benicia city officials said that they will work with the company during its operational changes and inform the community about any potential economic impacts and challenges. Valero currently pays $331,320 annually to the city as part of a cooperative agreement.

Benicia Mayor Steve Young said that the news impacts the entire community, as Valero has long been part of the city’s identity. 

“While this potential transition raises many questions, I want to reassure our residents that the city is committed to transparency, collaboration, and careful planning,” Young said in a statement Wednesday. “We will be working with Valero, regional partners, and state agencies to better understand the path ahead.” 

Benicia City Manager Mario Giuliani said, “This is a moment of significant transition for our city and community.” 

“However, Benicia has shown time and again that we are resilient,” Giluiani said. Over the past two years, we've faced tough budget challenges and worked hard to strengthen our economic foundation — and we will continue to move forward together.” 

Valero Energy Corporation has owned and operated the Benicia Refinery since 2000, before which the facility operated as Humble Oil or Exxon. The facility began operating in 1969.

The Benicia City Council recently approved an Industrial Health and Safety Ordinance regulating businesses producing hazardous materials, after years of study and pushback from Valero. A Valero spokesperson did not comment when asked if this policy had anything to do with the decision to close the Benicia refinery. 

Valero has been the subject of multiple environmental controversies, as it didn’t meet Bay Area Air Quality Management District requirements to monitor and report fugitive gasses from their operating equipment. Its refinery has also been the location of multiple pollution incidents, including a 15-year leak of 2.7 tons of airborne toxins which cost the refinery a record $82 million, paid to the Air District last year.