SOMERSET, Ky. — Continental Refining Company (CRC) on Friday will stop receiving crude oil, cease refining activity and enter a two-stage transition period leading to four major capital improvements.

CRC, formerly Somerset Refinery, said the first stage, estimated to take two months, is an idling and assessment stage. Results will determine length and scope of a second phase comprised of significant capital improvements including electrical upgrades, crude distillation unit replacement, hydrotreater upgrades and connection to a crude oil pipeline. Phase 2 is estimated to take between eight and 16 months.

“The decision to undergo this transition phase has serious consequences which include adjusting our workforce so that there are less administrative and transportation employees,” said a company news release. “This is regrettable but a necessary step to improve reliability and efficiency for the long term.”

Missy Shorey, spokesperson for CRC, did not respond to questions about levels of employment at the refinery during the transition phases. At the first of last year, CRC had 58 jobs at the refinery and six jobs at its transport company.

The company announcement this week said consistent with best practices and proper fiscal management, the refinery will shut down during the transition phases rather than risk safety and reliability by attempting to make changes while operating. Upon completion of the capital improvements projects, Continental Refining Company intends to increase hiring to meet production demands with streamlined operations and enhanced reliability as well as resume purchasing crude oil in the region, the company news release said.

Continental Refining Company will continue to work in compliance with regulators to ensure safety and environmental standards are met and upheld throughout this transition phase, the CRC announcement assured.

CRC is an icon in the Somerset area. Its predecessor, Somerset Refinery served oil producers in Kentucky and Tennessee for more than 80 years before financial problems in early 2010 forced it to close for nearly three years.

Demetrios Haseotes, an owner and past director of the Cumberland Group of Companies, which include Framingham, Mass.-based Cumberland Farms and Gulf Oil LP, formed Somerset-based Continental Refining Company (CRC) in December 2011 and purchased the troubled Somerset Refinery. Refining operations resumed in January 2013.

Continental Refining Company, located on a 93-acre site off Monticello Street, is one of only 150 refineries in the United States and only one of two refineries in Kentucky. CRC is the closest refinery for crude oil producers within a 170-miles radius. The other refinery in Kentucky is Catlettsburg Refining owned by Marathon Petroleum Corporation.

Pointing out its commitment to the Somerset area, “CRC expressed thanks to the community of Somerset in advance for their understanding and support during this process.” Continental Refining Company said it has invested $25 million dollars into its operations in Somerset.

Source: Commonwealth-Journal