Chamber CEO optimistic of economic rebound despite Motiva layoffs
Relying on her 35 years in the petrochemicals and refining industry, Pat Avery believes the announced merger of Motiva’s Port Arthur Refinery and Port Arthur Chemicals into one Port Arthur Complex is an act of “right-sizing.”
“I came to Texas in the late 1980s,” said Avery, now the Greater Port Arthur Chamber of Commerce’s president and CEO. “When I got here, I was hired by Mobil and my first job was in Houston. When I got to Houston, there were so many empty businesses, it looked horrible. I really thought I was coming to a doom town. There were boarded-up storefronts.”
The greater Houston area had just experienced an oil bust and residents had left six-figure homes as a result, Avery said.
“A year and a half later, prosperity returned in a greater abundance than ever before. The oil and petrochemical business is such as well-known business, they plan for the downturn.”
Avery believes, on the other hand, the downturn Motiva is experiencing may be more challenging. The company has announced it will cut 200 salary and professional contract jobs across its refinery, chemical plant, terminal and Houston headquarters, in addition to the refinery-chemical plant merger, as a result of the coronavirus pandemic’s impact on the economy. The reduction-in-force will not affect hourly operations, maintenance or lab team members.
“This downturn may be a little more difficult than most, but the strategic plan for the downturn is something they do extremely well,” Avery said. “I have great confidence those days will return.”
Avery said changes in Motiva’s operation would not affect her chamber. She added her comments are only personal and not reflective of what Motiva may or may not do.
“My 35 years in petrochemicals and refining tell me when there is a merger of a plant and it’s on the same site, there is a great deal of right-sizing,” she said.
In a statement, Motiva said: “The company will continue producing transportation fuels and chemicals responsibly with safety, financial stewardship, and operational excellence at its core.”
With a crude capacity of 630,000 barrels per day, the refinery is the largest in North America. Motiva declined comment on the operational status of its units that are reported to shut down this month, citing “competitive reasons.”
Some equipment is routinely shut down for maintenance purposes, the company said, but not because of any changes in organization.
“I can’t speak for Motiva, but with what’s going on with this virus, airplanes are not flying, the need for jet fuel is not there, and the fusing of the two facilities … I think they’re making business decisions based on the economy,” said Floyd Batiste, CEO of the Port Arthur Economic Development Corporation. “You have less than one-fourth of the airlines flying.”
The Port Arthur EDC works with the Texas Workforce Commission and Lamar State College Port Arthur to direct anyone facing job loss to training for on-demand skills. Motiva did not specify whether the layoffs are permanent, but Batiste is hopeful those who are laid off can return to work when the economy rebounds.
Avery is not so sure that everyone will entirely feel a negative impact from the reduction-in-force.
“Those that are near retirement may decide to go and not return to the workforce,” she said. “I’m not even sure if it’s going to affect our unemployment rate. It’s too early to tell. My experience with being in the industry all these years is that people who run these big companies are compassionate people and they will do the right thing by the people.”