California’s Gas Price Premium Has Never Been Higher, Here’s Why

California’s gasoline price premium to the rest of the nation is the highest on record, according to Bloomberg data. This, as OilPrice’s Andy Tully notes, is in large part because an Exxon Mobil Corp. refinery in Torrance has been out of commission since an explosion there in February, and the state’s environmental regulations are hampering the company’s efforts to quickly get it back to full production. This situation is not expected to improve by year-end.
The refinery is now operating at under 20 percent of its potential, mostly because the explosion damaged its two pollution control units, according to Mohsen Nazemi, the deputy executive officer for engineering and compliance of California’s Sourth Coast Air Quality Management District.
ExxonMobil has sought permission to use a previous model of the unit until the newer version can be installed, but was denied because the older unit emits between two and six times more greenhouse gases than the newer model, which would violate state regulations. To use the older equipment, he said, the company would need to show the state that it can contain offset these increased emissions.

This post was published at Zero Hedge on 07/21/2015.