HOVENSA Q and A
Published: August 19, 2013
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ST. CROIX - With the situation between the government and HOVENSA grabbing headlines in recent weeks, The Daily News is providing this backgrounder on the company and its facility on St. Croix.
Who built the refinery?
Hess Oil Virgin Islands Corp., or HOVIC, initially started construction on the refinery in 1966, after the Legislature ratified the company's first agreement with the government in September 1965. The agreement authorized a tax benefits package for HOVIC, which agreed to build an oil refinery on approximately 400 acres in Estates Hope, Blessing and Jerusalem, with an initial investment of $10 million and employing 125 people. Over the years, HOVIC acquired more land and the refinery was expanded.
How much land does hovensa occupy?
The HOVENSA refinery site sits on approximately 2,000 acres of land on St. Croix's south shore, including a tract of undeveloped land located immediately east of HOVENSA's housing units at Estate Figtree.
Who owns the land hovensa occupies?
HOVENSA does, with the exception of approximately 63 acres of reclaimed submerged lands - lands that were originally underwater and were filled by Hess Oil Virgin Islands Corp. pursuant to a dredging permit - that belong to the V.I. government. The V.I. Government leases those submerged lands to HOVENSA for $1 per year.
What is hovensa?
HOVENSA is a joint venture formed in 1998 between wholly-owned subsidiaries of Hess Corporation and Petroleos de Venezuela, S.A. The subsidiaries, Hess Oil Virgin Islands Corp. and PDVSA V.I., Inc., each own 50 percent of HOVENSA.
In 1998, PDVSA V.I. purchased a 50 percent undivided interest in the assets of Hess Oil Virgin Islands Corp. Hess Oil Virgin Islands and PDVSA V.I. then organized HOVENSA LLC and transferred their respective 50 percent interest to HOVENSA, thereby making HOVENSA the owner of all the property initially owned by Hess Oil Virgin Islands.
What is PDVSA?
PDVSA stands for Petroleos de Venezuela, S.A., the state-owned oil and natural gas company of Venezuela.
How many people does HOVENSA employ?
According to a report from the government's consultants, Duff and Phelps, the refinery was the largest private employer and taxpayer in the territory, employing approximately 1,200 full-time employees and 950 contractors at peak operations. According to testimony at Senate hearings in July, HOVENSA currently has about 100 full-time employees and about 500 contractors.
- Sources: HOVENSA, the V.I. government, Duff and Phelps report.