Chevron Corp., trying to reduce the huge debt it incurred last year in its $13.3 billion acquisition of Gulf Corp., said yesterday it has solicited bids for some of its gasoline refining and marketing operations in the Northeast and Puerto Rico.
The assets include operations in the District, Maryland and Virginia, as well as nine other eastern states.
Chevron's announcement follows the decision four months ago of Atlantic Richfield Co. to sell its refining and marketing operations east of the Mississippi. Financial analysts said both moves reflect a consolidation under way in an oil industry pressed by falling oil prices and excess refining and distribution capacity, particularly on the East Coast.
Chevron, based in San Francisco, would not estimate the value of the assets or the prices it is seeking. The company said the bidding would end on or about Oct. 18, and that it would not make a decision on what assets, if any, would be sold until it reviews the offers.
"Prospective buyers are being advised to give us their best offer," said Will Price, a senior vice president at Chevron USA. "There will not be an opportunity to negotiate a price after they come in with an initial bid. We could, in fact, decide not to sell once we've seen all the bids."
Any decision to sell some of the refining and marketing assets would be made by the end of the year, he said.
The company said it has "received expressions of interest from several potential buyers" and has distributed informational materials about its Northeast businesses. Prospective buyers have been invited to bid on:
*A 174,000 barrel-a-day oil refinery in Philadelphia and about half the company's related distribution and marketing assets in the District, Virginia, Maryland, Connecticut, Delaware, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island and Vermont. The company owns a total of 4,800 Gulf and Chevron service stations in the region, 26 terminals, an interest in two pipelines and four separate heating oil businesses. The operations together employ more than 1,600 workers.
*A 38,000 barrel-a-day oil refinery in Bayamon, Puerto Rico, and 275 Gulf and Chevron outlets. Together, the operations employ about 380 workers.
Because no decisions have been made on a possible sale, Chevron said "there is no way to predict exactly how employes might be affected."
Chevron reported short-term and long-term debt of $13.6 billion as of Aug. 1, the equivalent of 47 percent of total debt plus equity, down from 51 percent at the end of 1984.
The total debt now is lower because the Aug. 1 report did not reflect Chevron's recently announced agreement to sell all of Gulf Canada for $2.1 billion. The report does reflect a $1.9 billion reduction in total debt in the first half of the year.
Chevron recently reported an 8 percent drop in earnings for the first half of the year to $701 million from $758 million in the first six months of 1984. Sales grew to $24.3 billion this year from $19.8 billion in the first half of last year.
Chevron's announcement "was not unexpected" and is part of "an overall consolidation by all oil companies," said John Lichtblau, president of the Petroleum Industry Research Foundation Inc. The current excess refining and marketing capacity reflects a decline in the demand for gasoline from a 1978 peak of 7.4 million barrels a day to about 6.4 million barrels a day now, Lichtblau said. Companies are starting to pull out of certain regions to concentrate on their most profitable operations, Lichtblau said.