Come By Chance refinery sold, will become biofuel operation by mid-2022
CBC
The refinery in Come By Chance, N.L., has been sold to a U.S.-based private equity firm.
Cresta Fund Management has bought a controlling stake of the idled refinery, and plans to convert the plant to make aviation fuel and diesel from used cooking oil, corn oil and animal fat.
The firm has also renamed the plant, which will operate as Braya Renewable Fuels.
"The refinery is an important asset for Newfoundland and Labrador, for the jobs it supplies directly and indirectly to the local communities, to the region, and indeed to the entire province," said Premier Andrew Furey at a media briefing Tuesday.
Among its commitments to the refinery, Cresta will be required to maintain employment equal to a minimum of 200 full-time positions, which is fewer than the 335 workers represented by United Steelworkers Local 9316.
In mid-June, oil refinery workers voted 96 per cent in favour of a new collective agreement between the union and previous ownership group Silverpeak.
Silverpeak will stay on board with a minority interest in the refinery, and will continue to direct marketing.
In July, North Atlantic Refining Limited Partnership and Cresta reached an agreement-in-principle for the sale.
Cresta says initial production capacity will be 14,000 barrels per day, and hopes to have the operation running by mid-2022.
In a media release, Cresta said the company will have the ability to grow and adapt by modifying the refinery to expand the total capacity to 35,000 barrels per day, and expand "feedstock flexibility."
Kaushik Amin, a parter at Silverpeak, said $400 million has been invested in the first phase of the project, with the potential for millions more in future phases.
The fuel produced at the refinery will be exported out of province, meaning fuel will still need to be imported to the island of Newfoundland. There are no immediate plans to eliminate the extra five cents per litre the Public Utilities Board charges to cover importation expenses, said officials.
Jim Stump, a representative of Cresta who will be responsible for the implementation of the project, said renewable diesel is expensive to produce, but is profitable because of a "potpourri of incentives" in places like California.
"We'll make money the day we start up," he said.
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