Valero shuts down two ethanol plants and converts a third

Valero Energy Corp. has temporarily closed two of its ethanol plants and is retooling a third to make hand sanitizer as gasoline demand collapses globally.

Ethanol, produced from corn processed in the plants, is used in gasoline, but the coronavirus pandemic has kept many commuters at home.

“When gasoline consumption goes off the cliff, ethanol goes right away with it,” said Geoff Cooper, president and CEO of the Renewable Fuels Association.

Valero’s closure of the two plants in Albert City, Iowa, and Albion, Neb., will result in the furlough of about 135 workers, a company official confirmed. The San Antonio oil refiner owns 14 ethanol plants.

The plants closed last week.

So far, Valero hasn’t shuttered any of its 15 oil refineries, though the company has cut back operation as some facilities.

In addition to the drop in demand for gasoline, the flurry of canceled flights and grounded airplanes means less demand for Valero’s jet fuel.

Valero spokeswoman Lillian Riojas did say said the Fortune 500 company is turning a third ethanol plant in Hartley, Iowa, into a facility to make hand sanitizer in bulk as a community service.

“The plan is to provide this product to emergency care providers,” she said. “The goal is to help alleviate supply shortages especially for health care organizations and first responders.”

All 75 workers at the plant will stay on to produce the hand sanitizer.

“The hand sanitizer production goes through similar steps we take to produce fuel-grade ethanol — milling, fermentation, distilling, and dehydration,” she said.

Ethanol is a key ingredient in hand sanitizer.

Source: San Antonio Express-News