Refineries snub the state

Although under increasing scrutiny, Utah's five oil refineries snubbed official requests for financial information — even inquiries that were part of an investigation ordered by Gov. Jon Huntsman Jr.

"The refineries essentially flipped us off and said, 'We're not giving you any numbers,'" says Francine Giani, executive director of the Utah Department of Commerce, who led a state probe into gas prices. The Salt Lake-area refineries, she said, have demonstrated a wholesale disregard for any requests for information. "They don't want consumers to know exactly how much they are making.

"Are we getting gouged? The answer is still yes," Giani said.

Meanwhile, oil officials in Duchesne and Uintah counties also allege the refineries have reduced the amount of "black wax" crude oil from eastern Utah producers they will process in favor of the cheaper, easier crude imported by express pipeline from Canada.

In addition, Utah producers say refineries are now paying less than ever for the "black wax" product, so named for its high-paraffin, sludgy consistency. This type of crude doesn't travel well — it essentially congeals into solid wax like a candle — so it really can't be trucked farther than the two to three hours to the Salt Lake area refineries.

"We're held hostage," said John Jurrius, financial adviser to the Ute Indian Tribe and its growing oil interests.

So, in an environment where national energy experts are lamenting lagging production of domestic oil, local producers say they have no place to send their product.

But numerous phone calls to the refineries, corporate public relations offices and to Lee Peacock, spokesman for the Utah Petroleum Association, went unreturned through Friday.

Refinery secrecy is a concern Utah lawmakers may need to look into as a public policy issue, said Republican state Sen. Beverly Evans of Altamont. In 20 years as an elected official, Evans has watched the boom and bust of eastern Utah's energy industry.

"It needs to be a more open process than it is right now," she said Friday. "But how do you do that in the free market when you don't have the competition?"

Of the five refineries asked for information as part of the state's investigation, four responded only to say they would not provide anything. They advised Giani to check their Web sites. None of the five told Giani what prices they pay for crude oil.

"They essentially said, 'Kiss off,"' she said. So Giani's report concluded gas stations were making a "healthy profit off Utah consumers," but it did not identify the refineries' role in high gas prices.

Furthermore, only four of 24 retailers responded to the state's request for information.