With Irving seeking to close N.L. oil refinery deal, another suitor waits in the wings

A private U.S. company that specializes in recycling used oil is making no secret of its interest in Newfoundland and Labrador's only oil refinery, even as New Brunswick-based and family-owned Irving Oil seeks to close the deal on assets owned by North Atlantic Refining Corp.

If given the chance, a company called Origin International is pledging to resume the processing of various fuels at the Come By Chance refinery, hire the same or more personnel than worked at the facility before the pandemic, and expand the operation into "a moreenvironmentally sustainable model."

It's all spelled out in a June 8 letter, obtained by CBC News, to provincial Natural Resources Minister Siobhn Coady.

The letter is authored byNicholas Myerson, CEO of Origin International, based in Baltimore.

"In the event the Irving transaction stakeholders deem appropriate an assessment of alternatives to acquire NARC, Origin stands willing and able to re-engage in its bid for NARC," Myserson wrote.

• Irving will reopen dormant Come By Chance oil refinery, minister says

Myerson declined an interview requestbut confirmed the authenticity of the letterin an email to CBC News.

"We just wanted to make decision-makers aware of our interest in the province and a key asset in the event circumstances changed," Myerson wrote.

"We respect and will not interfere in the Silverpeak-Irving transaction."

Irving Oil preferred bidder

Origin made a competing bid to New York-based investment firm Silverpeak, owner of North Atlantic Refining assets, in May. However, Silverpeak selected the bid from Irving Oil for a undisclosed sum, and that deal is now being scrutinized by the Competition Bureau to ensure the Competition Act is not being violated.

Observers say the regulatory review could get complicated because the deal includes 50 North Atlantic filling stations across the province, including 21 Orangestore convenience stores.Irving Oil also operates a chain of filling stations, with many inclose proximity to North Atlantic or Orangestore-branded stations.

The Competition Bureau said in a statement it's "difficult to determine how long a particular investigation will take to complete," but insiders say the review could extend into early fall.

Origin does not have operations in Canada, and Myerson says it would sail through the regulatory approval process much swifter.

"This being the case, approximately 45 days of due diligence could be the main bottleneck to closing a transaction and bringing jobs back to the facility,"Myersonwrote.

Meanwhile, both Irving and Silverpeak have confirmed to CBC that the proposed sale is proceeding.

"At this time, as the agreement continues to be subject to regulatory review and conditions of sale being met, we have no further information to share," an Irving official wrote in a statement to CBC.

Irving also operates an oil refinery in Saint Johnand another in Ireland.

The company has said its interest in Come By Chance is part of a strategy to invest in "the broader Atlantic Basin"
and to further pursue "opportunities for growth in these regions, including Atlantic Canada."

• How a 'basket case' oil refinery in Newfoundland came out on top

Coady'soffice also confirmed it received the letter from Origin International, and that officials from the Department of Natural Resources and Origin took part in an "introductory call" on June 2.

"The purpose of the call was to indicate interest, as an alternative to Irving, with respect to the sale of NARL should the sale not progress," a natural resources spokesperson wrote.

"No further discussions have occurred."

North Atlanticsupplies heating oil, propane and gasoline across the province and employs about400 Newfoundlanders and Labradorians.

The Come By Chance refinery has a capacity to process 135,000 barrels of crude each day. However, itwas placed into care and maintenance mode in late March as theglobal pandemic forced a collapse in demand for transportation fuels, and the price of oil cratered.

Some 300 workers at the refinery are represented by Local 9316 of the United Steelworkers, thoughroughly 80 union members are currently on the job.

• Irving Oil blames pandemic for decision to cut 250 employees

Local president Glenn Nolan said the union is "staying positive" that the Irving Oil sale will proceed, though he admitted to concern about recent Irving layoffs in New Brunswick and elsewhere.

Meanwhile, Origin describes itself as one of the largest privately owned collectors and recyclers of residual oil and waste water in the U.S. and Europe.

The company operates three locations across the U.S.and Belgium, and isconstructing a waste oil recycling plant in Baltimore, Maryland.

"We believe that every barrel of oil we recycle means one less barrel going to landfill or being improperly combusted," Myerson wrote.

Myerson said his company is focused onenvironmental, social and governanceexcellence.

"We believe we are well placed to provide extended and beneficial life cycles to traditional hydrocarbon refining assets, while evolving traditional petroleum processing operations into a more environmentally sustainable model."

So how would Origin operate Come By Chance?

Myerson's letter to Coady says it would "transform" the refinery "into a more environmentally sustainable operation of the future."

Our intention would be to start the refinery back up with no public investment required. Our investors are not interested in adding any unnecessary burden to Canadian taxpayers.- Nicholas Myerson

To achieve this, the company says it would expand the existing waste-water treatment plant at the refinery and add "waste oil recycling streams to be co-processed with traditional crude feedstocks."

"Our intention would be to start the refinery back up with no public investment required. Our investors are not interested in adding any unnecessary burden to Canadian taxpayers."

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