Bulk Petroleum, which is owned by Darshan Dhaliwal, estimated that it has both assets and liabilities ranging from $50 million to $100 million, according to its filing in U.S. Bankruptcy Court cited by the newspaper. A more detailed accounting of the company's finances [image-nocss] will be filed with the court by mid-March, said Michael Dunn, one of Bulk Petroleum's attorneys.
The Mequon, Wis.-based company's largest unsecured creditors include CITGO Petroleum Corp., which is owed $4.96 million, and Marathon Ashland LLC, which is owed $3.46 million, the filing said.
Several real estate holding companies affiliated with Bulk Petroleum also filed for Chapter 11 protection, said the report. Those companies own gas stations in Wisconsin, Illinois and other states, which are then leased to individual operators, Dunn told the newspaper. Bulk Petroleum guaranteed the debts of those companies, he added.
Last year's record-setting spike in oil prices hurt Bulk Petroleum, Dunn said, by making it more expensive for the company to buy gasoline. Some, but not all, of those higher prices could be passed on to the station operators supplied by Bulk Petroleum, he said.
The collapse in oil prices that started last fall brought some relief to Bulk Petroleum, but not enough to prevent the Chapter 11 filing, Dunn said.
Bulk Petroleum has 29 employees.
The company has had a checkered past. In 2008, BP sued Bulk Petroleum, alleging that Dhaliwal swindled customers by knowingly selling unbranded, nonformulated gasoline out of BP stations, charging brand-name prices. (Click here for previous CSP Daily News coverage.)
In 2007, Iowa Attorney General Tom Miller filed a lawsuit against Bulk Petroleum for alleged environmental violations concerning 61 underground storage tanks (USTs) at 17 stations in Des Moines, Davenport, Blue Grass, Le Claire, Cedar Rapids, Waterloo, Burlington, Ames and Malcolm, Iowa. (For coverage, click here.)
In 2006, Wisconsin Attorney General Peg Lautenschlager sued the company for allegedly raising the posted prices of gasoline more than once in 24 hours in the days following Hurricane Katrina. (For coverage, click here.)
Dhaliwal also spent more than $1.2 million on mattresses, blankets, medicine and other goods immediately following the disastrous tsunami that hit South Asia in late 2004. (Click here for coverage.)
Dhaliwal is well-known is political circles as a major contributor to both Republican and Democratic politicians, including current Wisconsin Governor Jim Doyle and former Gov. Tommy Thompson. He also has been a large donor to area colleges, including a 2006 pledge of $4.5 million to the University of Wisconsin-Parkside to expand its communication arts building, said the report.
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