Hess 2002 Annual Report Download - page 14

Download and view the complete annual report

Please find page 14 of the 2002 Hess annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 62

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62

12
The Corporation’s refining and marketing business is
focused on improving financial returns from our HOVENSA
refinery joint venture and our marketing network on the
East Coast of the United States.
Refining
The HOVENSA refinery in the United States Virgin Islands,
jointly owned by the Corporation and Petroleos de
Venezuela, S.A. (PDVSA), is one of the largest in the world.
HOVENSA completed construction of its 58,000 barrel per
day coking unit in 2002, making it a world-class merchant
refinery. The coker permits HOVENSA to run lower-cost,
heavy crude oils to manufacture gasoline and heating oil.
Returns from the coker are supported by a 115,000 barrel
per day supply contract with PDVSA for heavy crude oil.
PDVSA also supplies HOVENSA with 155,000 barrels per
day of medium grade crude oil. With the coker on line,
HOVENSA will generally purchase approximately two-
thirds of its crude oil from Venezuela. Deliveries of crude
oil from Venezuela are returning to normal levels after
being interrupted by events in Venezuela in December
2002 and January 2003.
Marketing
The number of HESS retail marketing facilities on the East
Coast of the United States increased to nearly 1,200 at
year-end 2002 from 638 five years ago, making HESS the
leading independent convenience retail marketer on the
East Coast of the United States. During 2002, 25 new
HESS EXPRESS convenience store retail facilities were
added. The Corporation will continue adding HESS
EXPRESS convenience stores on the remaining 20% of
sites that do not currently have them to take advantage of
underutilized, high-quality real estate. HESS EXPRESS
convenience stores generally have several fast food offer-
ings, a proprietary coffee program and enhanced fountain
service, as well as a wide variety of convenience items.
HESS EXPRESS convenience stores significantly outpace
the industry average in both fuel and merchandise sales
and had significant growth in 2002 in same store sales
and gross margins.
REFINING &
MARKETING
Coking Unit, St. Croix
The coking unit at
HOVENSA will
enhance the refinery’s
financial returns.