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    Valero's Greehey Steps Down as CEO

    Executive vice president and COO Bill Klesse takes over; company's third-quarter profits climb.

    SAN ANTONIO -- After overseeing the growth of Valero Energy Corp. from a small company with a single refinery to the largest refiner in North America, CEO Bill Greehey has decided to step down from management, reported the San Antonio Business Journal .

    He will remain chairman of the board of directors. Executive vice president and COO Bill Klesse will now move into the CEO role and also has been elected to the board as vice chairman, according to the report.

    Klesse will begin serving in his new role on Jan. 1, 2006. Greg King will continue to serve as president of the company.

    Greehey became CEO of the company in 1980 after the court-ordered spin-off of LoVaca Gathering Co. from Houston-based Coastal States Gas Corp.

    He relocated the company to San Antonio and renamed it Valero Energy Corp. in honor of the Mission de Valero de San Antonio, better known as the Alamo.

    Under Greehey's leadership, the company commissioned its first refinery in Corpus Christi in 1984. Over the years that followed, Valero embarked on a growth-by-acquisition strategy that included the purchases of Basis Petroleum Corp. in 1997, Ultramar Diamond Shamrock Corp. in 2001 and Premcor Inc. this year, reported the San Antonio Business Journal .

    "I plan to remain actively involved in the strategic direction of both Valero and Valero LP, and plan to stay involved in Valero's employee, governmental and civic initiatives," Greehey told the San Antonio Business Journal . "And, of course, I will remain a visible advocate for the company and for the refining industry."

    Even though Greehey is stepping down as CEO, Klesse said in the report he will continue to build upon the foundation Greehey has put in place at Valero.

    "With Bill's continued involvement and the strong management team that is in place, I am confident that we'll continue to grow and achieve tremendous success, while preserving Valero's special corporate culture, which always puts employees first," Klesse told the San Antonio Business Journal .

    Klesse first joined Valero as executive vice president of refining and commercial operations when the company acquired Ultramar Diamond Shamrock in 2001. He was promoted to his current position in 2003, reported the San Antonio Business Journal .

    In other Valero news, the company reported its third-quarter operating income ballooned to $1.9 billion from $699 million last year as high fuel prices more than offset hurricane-related losses, according to philly.com.

    Valero’s third-quarter net income of $862 million included a $621 million noncash charge related to inventories held by Premcor Inc., which the company bought in September, according to the report.

    Even as refining profits surged, despite hurricane damage at two refineries, profits at the pump fell to $21 million in the quarter, from $36 million in the same period last year.

    Valero today owns and operates 18 refineries throughout the United States, Canada and the Caribbean with a combined throughput capacity of 3.3 million barrels a day. It also has a convenience-store network of more than 4,700 Valero, Diamond Shamrock, Shamrock, Ultramar and Beacon stores.

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