LyondellBasell Sells Houston Refinery Site To Valero For $320.5 Million, Calls It A 'Real Estate' Decision
CEO Peter Vanacker says the Valero sale is no strategy shift, and a second Moritech circularity plant is now assumed to be in Europe.
LyondellBasell, the plastics and chemicals maker, agreed to sell the site of its former Houston refinery to Valero for $320.5 million in cash, and CEO Peter Vanacker told analysts on the company's third-quarter earnings call Friday that the deal is a property and capital-allocation call, not a change in corporate strategy.
A real estate call, not a pivot
Vanacker said the company sees the sale "as a real estate, and a capital allocation decision rather than a change in our corporate strategy." The strategic decision, he said, was exiting refining, which the company announced and carried out in 2025. The site has been a non-operating asset since.
The price is all cash, payable at closing, which the company expects by the end of 2026. Valero takes over site operations, environmental liabilities and pension costs. Vanacker said the company weighed a range of uses for the site's infrastructure, and selling emerged as the most attractive way to create value while cutting future obligations and complexity.
He said the step helps improve cash flow by approximately $50 million to $100 million annually. Refinery upkeep would have required substantial investment, he added, and the company would rather spend in its core olefins and polyolefins and intermediates businesses.
LyondellBasell turns oil- and gas-based feedstocks into resins such as polyethylene and polypropylene, plus basic chemicals. Shares traded at $67.42 in Friday trading, up about 3% from the prior close.
Moritech Two moves toward Europe
A KeyBanc analyst asked whether the Moritech Two circularity plant was delayed or canceled. Vanacker noted the company delayed the final investment decision last year and updated its circularity goals earlier this year. "In the US, we do not yet see strong regulatory support that would eventually enable an investment in Moritech Two," he said.
The company now assumes Moritech Two would also be in Europe, once Moritech One, a semi-industrial plant in Wesseling, has started and been learned from. Any US deployment would be tied to demand visibility and regulatory progress, he said.
Cash, headcount and the quarter
Third-quarter earnings were $2.54 per diluted share on EBITDA of $1.5 billion, Vanacker said. Cash rose about $600 million to $3.2 billion, even after repaying a €500 million note, and liquidity reached $7.7 billion. Free cash flow was $1.4 billion.
CFO Agustin Izquierdo said the workforce is about 18% smaller than at the beginning of last year, driven by portfolio changes and restructuring. He said a $900 million maturity falls due in the first quarter and capital allocation priorities are unchanged. The company sold four European assets in May.
Closing of the Valero sale is expected by the end of 2026, subject to regulatory approvals and customary closing conditions.
Sources
- LYB Q3 Earnings Miss on Weak Polymer Prices Despite Oxyfuels Gains — Yahoo Finance
- LyondellBasell: Q3 Earnings Snapshot — Associated Press
- LyondellBasell stock edges down on missing Q3 estimates amid weaker demand — Yahoo Finance
- LyondellBasell reports third quarter 2026 earnings — Yahoo Finance
- LyondellBasell (LYB) Q3 Earnings Lag Estimates — Yahoo Finance
