CALGARY, Alberta -- Harvest Operations Corp. has reached an agreement to sell its 100% ownership in North Atlantic Refining Limited (NARL) to SilverRange Financial Partners LLC. The sale includes NARL's Canadian refining and marketing businesses in Newfoundland in Canada. The refinery is a 115,000 barrel-per-day crude oil refinery in Come By Chance, Newfoundland, while the marketing business includes convenience store/gas stations and other assets.
As part of the transaction, SilverRange will purchase inventories of crude oil and refined products as well as NARL's North Atlantic-branded marketing, marine and home heating businesses. The sale includes 53 North Atlantic and Home Town-branded gas stations and convenience stores, including 14 Orangestore-branded locations.
Terms of the sale were not disclosed.
Harvest acquired NARL and related marketing businesses from Vitol Refining Group B.V. for approximately $1.6 billion (Canadian; $1.44 billion U.S.), plus certain working capital and other adjustments, in Aug. 2006.
"We are very pleased to announce the sale of NARL, our Newfoundland-based subsidiary. Given Harvest's focus on investment in Canada's upstream business, we remain committed to maintaining and growing our operations in Western Canada," said John Wearing, Calgary, Alberta-based Harvest's COO. "At the same time, the Come By Chance refinery will remain an integral part of the local economy in Newfoundland and an important component of the energy supply chain on the Atlantic seaboard."
"This agreement provides a unique opportunity for SilverRange. NARL is strategically located along Atlantic crude oil shipping routes and provides access to petroleum markets in Europe and the U.S. Eastern seaboard. Its clean fuel technology enables the refinery to produce low-sulphur, clean fuels, providing flexibility to refine crudes from many parts of the world. In addition, the marketing business is a unique and attractive stable margin asset," said Harsh Rameshwar of SilverRange. "We look forward to becoming a part of the Newfoundland community."
The NARL transaction is subject to satisfaction of normal closing conditions, as well as regulatory approvals, and is expected to close in fourth-quarter 2014.
Harvest, a whollyowned subsidiary of Korea National Oil Corp., holds conventional oil and gas assets as well as oil sands assets in western Canada. KNOC is a state-owned oil and gas company engaged in the exploration and production of oil and gas along with storing petroleum resources.
SilverRange is an energy- and commodities-focused merchant bank based in New York.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.