Escalating regulations and rising petroleum prices were too much for Kauai Petroleum to compete, said a representative of the privately-owned, Kapa‘a-based corporation.
“To be compliant with environmental, governmental and security requirements was just too expensive,” said Kauai Petroleum President and General Manager Baltazar Manibog yesterday.
“We’re just too small to compete.”
San Antonio-based oil and gas refiner Tesoro announced the acquisition of Kauai Petroleum Friday for an undisclosed amount.
“Our shareholders decided now is a good time to get out of the petroleum industry,” Manibog said.
Kauai Petroleum’s approximately 3,000 shareholders are expected to vote on the deal at the end of June.
“All of the preliminary discussions we’ve have with the shareholders indicate this is going to be a go,” Manibog said.
Pending final approval, Tesoro will assume control of Kauai Petroleum’s four Union 76 service stations, the Nawiliwili gasoline terminal and all trucking and other assets, including two pieces of real estate.
Kauai Petroleum will cease to exist, marking the end for the local company founded in 1948.
“The majority of our shareholders live here on Kaua‘i,” Manibog said. “Most are children of original investors.”
Manibog said the company entertained several offers since it was put up for bid October, but Tesoro’s offer was the highest.
Tesoro hopes to capitalize on Kaua‘i’s position as the island with the fastest-growing, jet-fuel demand and fourth-largest fuel market in Hawai‘i, President and Chief Executive Bruce Smith said in a statement Friday.
Tesoro plans to offer employment to Kauai Petroleum’s 18 full- and part-time employees, pending background checks.
Manibog said Sunday he removed himself from consideration for employment with Tesoro.
• Ford Gunter, staff writer, may be reached at 245-3681 (ext. 251) or email@example.com.