HOVENSA Chatter Heating Up Again!

I tried the link but it said it was broken?

"Sorry, this page isn't available
The link you followed may be broken, or the page may have been removed."

heard a bit of chatter this am on the vybe

I tried the link but it said it was broken?

"Sorry, this page isn't available
The link you followed may be broken, or the page may have been removed."

I clicked the link and it took me right to Redfield's Facebook page.

I have confirmation that ABR is one of the two bidders from an attorney who is close to the situation.

This is from the ABR website....not sure if it's new news or not as there isn't a date on it...

Atlantic Basin Refining, Inc. (“ABR”) is a Virgin Islands company located on the island of St. Croix. ABR has reached an agreement in principle to purchase Hovensa, LLC, inclusive of the Hovensa Refinery and all related contracts and assets. Pending ratification of the 30th Legislature of the Virgin Islands, ABR has also reached an agreement with the Government of the Virgin Islands regarding the terms and conditions of Hovensa, LLC’s operation of the Hovensa Refinery.

Once reconfigured, the strategically located St. Croix refinery will be a state-of-the-art refinery built to capitalize on the U.S. shale boom. Initially, the reconfigured St. Croix refinery will process 300,000 barrels of crude per day. Refining U.S. light sweet crude will increase refinery flexibility and profitability while reducing power demand, fuel use and emissions. Under ABR’s ownership, Hovensa’s first priority will be safety and environmental compliance.

Upon restart, the refinery will support at least 500 full-time positions and at least a hundred subcontracted employees. Operation as a strong merchant refinery will allow ABR to maximize opportunities presented by the U.S. shale revolution, bringing significant tax revenues, training and jobs to the U.S. Virgin Islands. Under ABR’s ownership, Hovensa, LLC will foster a motivational refinery culture that will reward safety, environmental compliance, teamwork, entrepreneurial spirit and community service.

This is from the ABR website....not sure if it's new news or not as there isn't a date on it...

Old news. The legislature squashed the proposal in December 2014.

Oldtart, thanks for clarifying. 🙂

Story in the Avis today says ABR has partnered with another company and will try again.

Mapp must be selling the refinery to Guam hence the extended trip.

I wish the Avis was on-line, nothing to read on the Source, VI Daily News, or even the Consortium web-sites.

Has anyone heard:
Who has ABR teamed up with?
I thought Hovensa's docks and port facilities were already sold?
Wasn't the govenor trying to cut a deal with the Feds to convert it into a prison?

I'm surprised this issue hasn't generated more news.
Thanks

I'm surprised this issue hasn't generated more news.
Thanks

Not sure what you're surprised about. When there's something to report it'll be reported. Just because the Avis reports that, "ABR has partnered with another company and will try again" means precious little. As far as the other two snippets you "heard" the first is incorrect and the second came from the Governor's mouth amongst a veritable string of fantasies he threw out during a national TV interview which were subsequently denied by the other parties involved ...

ABR is smart. By getting the 30th legislature to vote on the operating agreement, they shook all the skeletons out of the closet and got the senators to play out their hand.

Now that ABR knows what the senate's issues are/were, they can easily mitigate them one by one, structuring their next proposal to overcome the previous concerns. It will be hard for the senator's who voted against the previous deal to mount much resistance when their stated objections are overcome.

As far as Mapp is concerned, I don't think he could care less who owns the refinery as long as the government gets the money its owed. Having the refinery operating will allow Mapp to execute on many of his promises and ultimately get reelected.

Brilliant I say.

Has anyone heard:
Who has ABR teamed up with?

http://www.jpenergypartners.com/company.php

I was just reading their SEC filings...these guys have access to a lot of cash.

Where are you seeing that they have access to "A lot of cash"?

They raised $260MM. Don't think they're a real player

There is a difference to having cash and having access to cash. Did you buy your house for cash or did you get a loan?

Wake me when it's a done deal.

There is a difference to having cash and having access to cash. Did you buy your house for cash or did you get a loan?

Apples and Oranges

JP is a midstream company, probably helps the deal but I don't think moves the needle (if there's a deal in place).

Are you saying that because they don't operate an oil refinery that they aren't capable?
That does not hold water. Companies hire experts when their current knowledge base is not sufficient. There are plenty of qualified people available for the right paycheck.

You specifically pointed out their cash on hand. That is irrelevant if they have the ability to raise the funding they need, which they can. I don't see the comparison to you buying a house as any different.

JP is a midstream company, probably helps the deal but I don't think moves the needle (if there's a deal in place).

Did you look into the company at all? Nor am I sure what you mean when you say there is nothing there to "move the needle if there's a deal in place". It seems there is ample magnetism there to move a needle - but there is no deal in place and this is all speculation.

Can ABR address the Senate's concerns?

1) Financial viability / Industry experience = JP Energy helps
2) $200mil in taxes owed = ?
3) Terms of the tax break, subsidiary companies get tax breaks = ?
4) Health concerns = ?

http://viconsortium.com/business/abr-deal-dead-sanes-buckley-vote-yes/

If they can address these concerns, we could have a win-win-win.
Here's hoping!

ABR obviously has a very well thought out strategy for the Hovensa acquisition. I knew we hadn't seen the last of them.

2) $200mil in taxes owed = ?

Other way around. Hess/PDVSA has already sued for the return of the tax over payments that the VIG has been sitting on for many years.

Remember, it is our local IRB, the ones that can't do a damn thing right, who counter claimed that Hovensa owed $200 million after the Hess/PDVSA claim - just to cover their a$$.

Are you saying that because they don't operate an oil refinery that they aren't capable?
That does not hold water. Companies hire experts when their current knowledge base is not sufficient. There are plenty of qualified people available for the right paycheck.

So now you have 2 entities that dont have experience running a refinery, trying to buy a refinery? Doesn’t address the fact that neither has experience running a refinery. They can hire someone to run/manage the refinery, though that will likely eat into their Margins and will affect their Pro Forma, which will affect their ability to raise capital.

You specifically pointed out their cash on hand. That is irrelevant if they have the ability to raise the funding they need, which they can. I don't see the comparison to you buying a house as any different.

Their raise was less than a year ago and was well under what is needed. The operating capital and costs to restart are a level of magnitude larger than what they’ve raised to date.

A more apt comparison would be one going for a very large loan to buy a company that the one has no experience with.

Not trying to be a downer on this as I really hope the refinery gets restarted and these guys are about a million times more real than the clowns from NJ. That being said, I’d feel a lot more optimistic if they we’re working with a Koch, Phillips, Holly, Etc

If you look at JP Energy, a company that was nothing before 2010 and look where they are now, it proves their ability to do things that they no nothing about.

Companies have to start somewhere. In the big leagues it isn't the same as buying a bakery or dress shop.

I hope they restart too, but I think it unlikely due to the current state of the equipment. Every pump and compressor is going to have to be gone through, and the motors will all have to be tested. At the least they could operate as a terminal and employ a couple of hundred people and sell off the rest.