Tesoro acquired Shell Oil’s Los Angeles refinery (100,000 barrels per day) and 278 retail gasoline stations in Southern California for $1.8 billion in the spring of 2007. Earlier in 2007, Tesoro also acquired USA Petroleum’s 138 gasoline stations in California for $273 million. These two acquisitions resulted in a large increase in Tesoro’s refining capacity in California and also dramatically increased its presence in retail gasoline operation within the state. Econ One was retained by the California Attorney General to assist the State in its review of these acquisitions. Barry Pulliam and Tony Finizza analyzed potential competitive issues associated with these transactions.