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The Government House Blog
Governor de Jongh Submits Testimony to Congressional Committee
Posted by Jean Greaux on April 27, 2012 at 11:48 AM AST

Governor de Jongh submitted testimony today to a congressional committee studying the adverse effects of St. Croix's HOVENSA refinery closure on the northeastern United States. 

In addition, the governor’s testimony was part of an ongoing Administration effort to raise Congressional awareness of the effect of the HOVENSA closure on the Virgin Islands. 

The governor's written statement to Senator Bob Casey, Chairman of the U.S. Congress Joint Economic Committee, explained the challenges to the Northeastern region, and the Virgin Islands, caused by HOVENSA's 500,000 barrel per day refining capacity being removed from the fuel market.

By 2011, HOVENSA was not operating at full capacity, but still producing 350,000 barrels a day.

“As you know, the U.S. Virgin Islands has been adapting to the sudden closure of one of the largest refineries in the Atlantic Basin, and it is encouraging to the people of the U.S. Virgin Islands to know that this Committee is concerned with the broader economic implications of the loss of refining capacity in the region,” the governor's statement reads.

The refinery's products, gasoline and distillate, mostly ended up on the East Coast, supporting that region's fuel needs. In 2007, the region imported two-thirds of HOVENSA's output.

HOVENSA's closure after 45 years of operation, and the nearly simultaneous closures of some Pennsylvania-based refineries, will stress Lower Atlantic and New York Harbor supply routes, according to the governor.

It will be difficult to compensate for the supply disruptions by employing alternate routes from the Gulf Coast—the pipeline delivering from those producers is near capacity, and Gulf Coast shipping is under restrictions of the Jones Act, a federal law that regulates the maritime industry and does not apply to the territory's exports. 

“All of this is to say nothing of the catastrophic impact of the HOVENSA closure on the USVI itself, which has lost not only its largest employer and taxpayer but also its sole existing source of gasoline and the fuel oil that powers its electricity and water supplies,” the governor told the congressional committee.