Aegean Marine: Sale of BORCO now imminent
The Aegean Marine Petroleum Network Company has emerged as the top bidder for the sale of The Bahamas Oil Refining Company (BOR-CO) International Limited with an offering of $710 million.
Aegean Marine Petroleum had increased its offer for BORCO from $450 million to $710 million in the hope of outbidding other contenders. Serious bidders were said to include the US investment bank Morgan Stanley, NuStar Energy, Glencore, Vitol, PetroChina and Petrobras.
The board of Petroleos de Venezuela S.A. (PDVSA), BORCO's sole owner, has invited Dimitris Melisanidis, founder of Aegean Petroleum Network Company, to Caracas, Venezuela, to personally conclude the negotiations for the final purchase of the long, sought-after BORCO plant in Freeport.
The company was the first to be invited to discuss final terms of sale with the board, and, it is believed that the final overall price will exceed $1 billion, according to a press release from Manasse Echegeray Energy Consultants on Saturday.
Aegean had outbid companies Nu Star and Morgan Stanley in the initial round of bids run by Citigroup but had its bid initially rejected, the release confirmed.
There were reportedly some seven serious bidders vying for the Grand Bahama plant and reports since late November of a sale. However, no company name was disclosed in the newspaper reports, only that it was a French company.
Subsequent investigations by PDVSA, BORCO's sole owner, have since recognized the Aegean bid as the highest one received.
Belkys Reyes, energy consultant in Caracas who works closely with PDSVA, has confirmed that Aegean is now the clear front runner for the purchase of the BORCO Deposit. According to Reyes, the board of PDSVA, Asdrubal Cavez and Jesus Villanueva are expecting the arrival of Melissanidis in Caracas next week to conclude all the negotiations.
"If all the financial details of this intricate deal are agreed upon, Aegean will become the new owner of the BORCO Deposit in Freeport, Bahamas," said Reyes. This come as a surprise, since in early September, it was reported that all negotiations were cancelled, with PDVSA claiming that the bidding process was just an ''exercise'', in order to determine the potential value of BORCO.
This now appears to have been a trick. Aegean Marine Petroleum Network Inc. is an international marine fuel logistics company that markets and physically supplies refined marine fuel and lubricants to ships in port and at sea. As a physical supplier, the company purchases marine fuel from refineries, major oil producers and other sources. Aegean has service centers in Hellas, Gibraltar, Singa-pore, Jamaica, the United Arab Emirates, West Africa and Northern Europe which allow it to service ships across the Atlantic.
The Hellenic company owns a fleet of tankers to service its customers, which include the U.S. Navy and commercial ship owners, as well as fuel brokers.
PDVSA is the state owned oil company of Venezuela and had purchased BORCO from Chevron in 1990.
The plant, which is a 20 million-barrel-capacity crude and product storage, blending, bunkering and transshipment terminal, currently has 164 employees.
Construction on BORCO started in 1968 and was completed in seven years on more than 550 acres. The plant began operation in 1970, however, the refinery permanently shut down in 1985, operating as an independent storage terminal afterwards.
The BORCO terminal reportedly ranks as one of the largest terminals in the world in terms of barrels handled, number of ships and summer deadweight tonnage (SDWT) capacity.
Source: The Freeport News
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