Philadelphia Energy Solutions taps its COO to lead company
NEW YORK (Reuters) -- Philadelphia Energy Solutions has tapped chief operating officer Gregory Gatta as its next chief executive officer, the refining company said on Wednesday.
Gatta, 41, an investment professional who worked at various private equity firms including Basso Capital Management and Pegasus Capital Advisors, will replace CEO Phil Rinaldi, who is retiring in March.
Rinaldi has been CEO of the privately held company since 2010, when Carlyle Group and Sunoco formed a joint venture to rescue the Philadelphia refinery, the largest and oldest on the US East Coast.
The transition comes as the 335,000-bpd plant is fighting to survive an industry downturn that has hit the US East Coast particularly hard.
Despite the recent setbacks, US East Coast refineries remain essential parts of the nation's energy ecosystem, Gatta said, noting that the densely populated region is short on products, requiring Gulf Coast refiners and imports to make up the difference.
"I am pretty bullish on the East Coast refining market," Gatta said in a phone interview on Wednesday.
The private equity experience instilled a disciplined approach to buying assets and improving them, Gatta said. The last few years, Gatta said, he has experienced all facets of the refining industry.
“I am a sophisticated financial investor, but I feel like I am an experienced refiner as well,” he said.
Gatta declined to discuss any significant operational changes he may pursue at the refinery, such as adjusting the crude slate or product yields, but noted that he and his team were going to "look under every rock" to see where they can optimize operations.
Rinaldi was the region's strongest advocate for energy expansion as the refinery turned profits off cheap crude flowing out of North Dakota. He was also the face of the effort to bring a natural gas pipeline into Philadelphia that could be used for industrial purposes.
Gatta said supports Rinaldi's vision but said he will not assume the role as the face of the effort.
Boom turned to bust by the end of 2015, however, as the Bakken discount to the US benchmark crude price disappeared, production dropped and more pipeline capacity came online.
The refinery has suffered several high-profile setbacks in the past two years, including a failed effort to take the company public, followed by layoffs and benefit cuts amid weak margins.
Moody's and Standard & Poor's have recently downgraded the company's debt amid concerns about falling profits.
Reporting by Jarrett Renshaw; Editing by Chris Reese and Meredith Mazzilli
Comments