PHILLIPS starts sulfur credit exchange for refiners

Monday, June 4th 2001, 12:00 am
By: News On 6

BARTLESVILLE, Okla. (AP) _ Phillips Petroleum Co. has opened a clearinghouse where refiners can buy and sell credits to help them meet more stringent motor fuel standards designed to cut pollutants.

The U.S. Environmental Protection Agency is clamping down on sulfur in gasoline and diesel with the goal of curbing emissions by the equivalent of 164 million cars on the road.

Beginning in 2004, refiners are supposed to manufacture gasoline with an average sulfur content no higher than 300 parts per million per gallon. In 2005, the average tightens to 30 parts per million. Sulfur in diesel is to be lowered to 15 parts per million by June 2006.

The EPA began giving credits last year to refiners able to reduce sulfur below averages for fuel produced in 1997-98. Credits are generated based on annual fuel production at a refinery. Refiners can accrue credits through 2004 and sell them to other refiners.

Refiners that fail temporarily to produce fuel that meets tighter limits could buy credits that would put them in compliance until plant upgrades are complete, Phillips spokesman Rich Johnson said.

Bartlesville-based Phillips has opened an exchange for buyers and sellers and would earn transaction fees.

Phillips is generating early credits because of a new sulfur removal technology in use at its Borger, Texas, refinery, the company said.