Shuttered Limetree Bay refinery gets $20 million from company eyeing a restart -court filing

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(Businesshala) – The closed Limetri Bay refinery in the U.S. Virgin Islands received a $20 million horse-drawn bid from a company looking to restart the facility, according to a Sunday court filing in Texas bankruptcy court.

FILE PHOTO: The installation of the Limetree Bay Petroleum Refinery is seen on June 28, 2017 in St. Croix, US Virgin Islands. Businesshala / Alvin Baez

The refinery, which had been closed for nearly a decade, reopened earlier this year under the ownership of private equity firms EIG and ArcLight Capital, after investors poured $4.1 billion into reviving it.

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Investors wanted to restart the facility to produce 210,000 barrels of gasoline and other fuels per day. Its planned restart was delayed by more than a year, and it operated for only a few months after US regulators shut it down, after it piled up oil and contaminated drinking water on homes.

According to filings in the U.S. Bankruptcy Court for the Southern District of Texas of Houston Division, St. Croix Energy LLC has been named the horse’s bidder for the facility and is currently the sole qualified bidder. The auction is scheduled for Monday, but Limtree’s general counsel proposed on Sunday that it could be extended to a later week.

A “stocking horse” bid is used as the opening bid or minimum accepted offer that other interested bidders want to purchase the company.

St. Croix Energy, which describes itself as “a group of businessmen with deep roots in the Virgin Islands,” said in a news release in October that it was committed to restarting the refinery safely.

The company comprises industry professionals with decades of experience in the refining, marketing and renewable fuel sectors, the release said.

Limetri said it is still in the process of working with other qualified bidders. According to the filing, more than 30 parties, including several, have proposed to liquidate the facility and sell the property.

Some potential buyers, including St. Croix Energy, had previously expressed concerns that Environmental Protection Agency requirements would prolong the permitting process and reduce interest in a potential sale.

Buyers could be on the hook for newly discovered groundwater contamination near the site and several other unspecified costs, according to a letter from environmental regulators reviewed by Businesshala.

Reporting by Laura Sainikola; Editing by Tom Hogg and Peter Cooney

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