Biology of Business

Penuelas

TL;DR

CORCO refinery (1954-1982) made Peñuelas Puerto Rico's petroleum hub—2,700 jobs, 80% of island fuel—then left 3,500 acres of brownfields. Maria (2017) and 6.4 earthquake (2020) hit 'la zona sacrificada.'

municipality in Puerto Rico

By Alex Denne

Peñuelas exists in Puerto Rico's sacrifice zone—the southern coast where petroleum built an economy and then poisoned it. Founded in 1793 by Diego de Alvarado, the valley's agricultural settlements seemed destined for typical sugar-and-coffee obscurity. Then Operation Bootstrap arrived.

In 1954, Commonwealth Oil Refining Company (CORCO) began construction in Peñuelas and neighboring Guayanilla. By 1978, the refinery employed 2,700 workers—Puerto Rico's largest employer—and supplied 80% of all petroleum products consumed on the island. Fortune Magazine ranked CORCO among America's 500 largest companies. Phillips, Peerless Petrochemicals, PPG Industries, and other chemical manufacturers built adjacent facilities. The 'Valley of the Flamboyanes' became a petrochemical corridor.

The 1973 oil embargo killed it. CORCO imported Venezuelan crude; mainland refineries could buy domestic oil. Without that buffer, Puerto Rican refining couldn't compete. CORCO declared bankruptcy in 1974 and ceased operations in 1982, leaving 3,500 acres of contaminated brownfields across 42 privately-held sites. The skeleton infrastructure now serves only as storage terminal for oil transportation.

Natural catastrophe followed industrial collapse. Hurricane Maria (2017) destroyed 1,500 homes completely, 500 partially. Then the 2020 earthquake swarm: nearly 1,000 tremors culminating in a 6.4 magnitude quake that devastated the southern region locals call 'la zona sacrificada.' Peñuelas—the Capital of the Güiro, the Valley of the Royal Poinciana—tests whether any recovery follows when both economy and geography have been sacrificed to forces beyond local control.