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U.S. refiner and bunker supplier Valero Energy Corporation has confirmed that it intends to shut its 255,000 barrels-per-day (bpd) refinery in Aruba for two to three months due to poor margins.

The bunker-producing facility is scheduled to begin shutting down towards the end of June and will be completely offline by early July, company spokesman Bill Day said Thursday.

"Margins aren't great and sour crude discounts are very small, so that refinery is not profitable right now," Day said.

The Aruba facility processes a large amount of heavy crude, which is typically sold at a larger discount compared to light crude. However, the discount has declined significantly, making it now almost as expensive as light crude. Meanwhile, distillate margins have also been low.

During the shutdown Valero plans to carry out maintenance work on the refinery's electrical system and other work, Day said.

Earlier this year, the company also carried out a similar shutdown at its 210,000 bpd refinery in Delaware City. Day said temporary shutdowns were not planned for other Valero refineries and added that the refinery's employees will not lose their jobs, but will either work in maintenance projects or receive training.

Valero purchased the Aruba refinery in 2004 for $465 million. It began seeking a buyer for the facility towards the end of 2007 and was reported to have negotiated a deal with Brazil's Petrobras for approximately US$2.8 billion before a fire took place on January 25th 2008 in a vaccuum distillation unit.

Other buyers said to be interested in purchasing the refinery earlier this year were PetroChina and Colombia's Ecopetrol. However, the facility's inability to make finished products is considered to be one of the main reasons Valero has not been able to sell the refinery so far.