(Argus, 10.Jun.2020) — The restart of an oil refinery in the US Virgin Islands is poised for another delay because of pandemic restrictions.
The refinery was supposed to reopen in July after undergoing a $2bn overhaul by Limetree Bay Ventures, which is owned by US private equity firm Arclight Capital Partners and US commodity trader Freepoint Commodities.
The restart was already pushed back from earlier targets of end-2019 and then early-2020 because of corrosion.
The new potential delay because of the pandemic was confirmed by the territory’s budget director Jennifer O’Neal, who highlighted the loss of bunker demand from cruise ships. “In addition to the near-term complications due to Covid-19, the USVI faces major structural issues that will impact long-term growth.”
Limetree Bay that manages the refinery and 34mn bl of storage capacity has not responded to requests for comment.
BP reached a tolling and offtake agreement with Limetree Bay in 2018 to supply crude to the refinery and to market 200,000 b/d of low-sulfur products, including marine fuel.
The terminal is currently used for storage and transshipment.
The refinery had a original design capacity of 525,000 b/d and was previously owned by Hovensa, a joint venture between Venezuelan state-owned PdV and US independent Hess. Hess and PdV shut the facility in 2012 when it was operating at 350,000 b/d, saying it had lost $1.3bn over three years.
Arclight Capital Partners and Freepoint Commodities acquired the complex in 2016.
By Canute James