Limetree Bay Refinery's Winning Bidder Intends to Increase Production
01.10.2022 - NEWS

January 10, 2022 [The Virgin Islands Daily News] – West Indies Petroleum Ltd., the winner of the second auction for troubled Limetree Bay refinery, issued its first public statement on the sale Friday.

 

The Jamaican company won the Dec. 18 auction with a $62 million bid, after a Texas bankruptcy judge voided the results of a first auction, which had been won by St. Croix Energy.

The company has not previously responded to requests for comment from The Daily News.

“No doubt we are committed to and confident about successfully closing out the sale and moving towards maximizing the potential benefits that this refinery may have on improving not just local or regional but also global energy security,” West Indies Petroleum Chief Executive Officer Charles Chambers said in the prepared statement.

West Indies Petroleum has until Jan. 21 to close the sale, or back-up bidder St. Croix Energy, which submitted a $57 million bid, could take over the facility.

West Indies Petroleum noted that Limetree Bay refinery’s current operating capacity of 220,000 barrels per day far outpaces Jamaica’s state-owned refinery, Petrojam, “which is reportedly approximately 30,000 barrels per day and a refinery in Suriname, which operates at approximately 15,000 barrels per day.

West Indies Petroleum “intends to increase Limetree Bay’s operating capacity to approximately 450,000 barrels per day.”

At its peak under Hess, the refinery processed 650,000 barrels per day making it one of the world’s largest refineries.

According to West Indies Petroleum, $4 billion had been expended upgrading equipment and modernizing the facility before it went bankrupt, and the company “expects that its investment in Limetree Bay refinery will eventually assist in reducing energy costs, in particular in St. Croix where the refinery has been upgraded to use LPG as its source of power generation,” according to the news release.

The plan to increase production at the refinery is “potentially game changing, not only for St. Croix, Jamaica and the region but a host of countries across the globe,” according to a statement by West Indies Senior Vice President Danville Walker.

Walker, who is a past chairman of Jamaica’s Natural Resources Conservation Authority, said that “to be very clear WIPL is fully aware of past environmental mishaps which occurred during the operation of the Limetree Bay refinery in its previous proprietary dispensation and our proposed operation of the mega-facility will not only see us seeking not to repeat errors made and but also being mindful of the prescriptions and mandate of the Environmental Protection Agency.”

Walker said the company plans to work with the EPA to close the bid and reopen the refinery.

The refinery had previously shut down in 2012 after years of economic troubles were compounded by violations of the Clean Air Act. The brief but disastrous restart in February resulted in several environmental contamination incidents that left at least 1,200 nearby homes coated in oil particles and the layoff of hundreds of refinery employees and contractors.

The EPA recently made it clear that the winning bidder “will need to engage with EPA regarding environmental compliance and permitting issues prior to the start-up of any operations at the refinery,” according to EPA spokesman Elias Rodriguez.

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