Top Valero executive receives total compensation of $10.9 million in 2009, review shows

Top Valero executive gets $10.9M in 2009

COLUMBUS, Ohio — The top executive of Valero Energy received compensation valued at $10.9 million in 2009, representing a 64 percent increase from the prior year, according to an Associated Press calculation of figures disclosed in a regulatory filing by the nation’s largest independent petroleum refinery.

The compensation of Bill Klesse, Valero’s president, chairman and CEO, came even as Valero reported a loss of nearly $2 billion in 2009 as refiners have struggled to pass much higher oil prices on to customers.

Klesse’s salary of $1.5 million remained the same as in 2008 and he drew no bonus last year unlike the $705,510 bonus he received in 2008, according to the March 2 filing.

Klesse asked that he not be paid a bonus last year because of the difficult industry conditions and since Valero lost money, the filing said.

The big difference was in stock and options awards valued at $9.2 million when they were granted in 2009, more than double the $4.3 million he received in 2008.

Oil prices have more than doubled in the past year even though Americans’ appetite for energy is not as strong as in prior years. Gasoline prices have risen, but not at the same rate, shrinking margins for refiners such as Valero.

Valero, like other refiners, has been cutting back production to bring it more in line with demand. It also has shut down a refinery in Delaware.

Klesse said Valero, based in San Antonio, has taken steps to cut unprofitable parts of its business, and 2010 should be Valero’s first profitable year since 2007.

Valero’s stock declined nearly 26 percent in 2009.

The Associated Press calculations of total pay include executives’ salary, bonus, incentives, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year. The calculations don’t include changes in the present value of pension benefits, and they sometimes differ from the totals companies list in the summary compensation table of proxy statements filed with the SEC.