Refiner PBF Energy operating at minimum rates due to COVID-19 hit

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PBF Energy Inc on Monday said it was operating its refineries at minimum rates, with throughput about 30% lower than the refiner’s expectations, as coronavirus-driven travel curbs hit fuel demand.

The company also announced sweeping cost-cutting measures, including scrapping its dividend, to tackle the demand shock from the virus pandemic as travel restrictions have led to grounding of flights and fewer vehicles on roads.

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The refiner announced pay cuts taken by company executives and employees, with Chief Executive Officer Thomas Nimbley taking a 67% cut, while the board and executive leadership have halved their compensation.

The refiner expects to lower 2020 operating expenses by about $125 million and will reduce capital expenditure for the year by $240 million or 35%, including spending on the newly acquired Martinez refinery.

The company also withdrew its throughput outlook for the first quarter and 2020, and said it was suspending its quarterly dividend of $0.30 per share.

PBF also agreed to sell five hydrogen plants to Air Products and Chemicals Inc for $530 million in cash. (Reporting by Shanti S Nair in Bengaluru; Editing by Devika Syamnath)