U.S. Refining Capacity:

How Much Is Enough?

EMD-78-77: Published: Jan 15, 1979. Publicly Released: Jan 15, 1979.

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Between 83 and 92 percent of the nation's petroleum products are provided by U.S.-based refineries, and the U.S. refining industry is planning capacity additions in order to maintain this position. The Department of Energy (DOE) must define refining capacity needs after evaluating the domestic and international tradeoffs involved. The following domestic factors are reviewed by GAO: (1) concern for air quality and related air quality regulations; (2) multiple use of the coastal zone under the Coastal Zone Management Act; (3) pricing and allocation regulations; (4) gasoline lead content restrictions; (5) environmental and technological requirements for desulfurization equipment; and (6) the Crude Oil Entitlements Program.

After reviewing domestic programs and policies and international considerations, GAO believes that DOE has not evaluated the tradeoffs necessary to establish a definitive U.S. refining policy. In response to this need, DOE recently initiated a study to identify future U.S. refining capacity needs.

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