Hearing to confirm Philadelphia refinery sale delayed by a week
A hearing to finalize Philadelphia Energy Solution’s bankruptcy plan and consummate a sale of the company’s refinery to a real estate developer was pushed back along with a deadline for objections to the deal, according to federal court filings.
The plan is now scheduled to go before the United States Bankruptcy Court for the District of Delaware to be finalized on Feb. 12 instead of Thursday. The deadline for objections was extended two days to Wednesday.
No official reason was given for the rescheduling and PES did not immediately respond to requests for comment.
PES last month entered into an agreement to sell its refinery, the largest and oldest on the East Coast, to Chicago-based Hilco Redevelopment Partners, which is expected to use the site largely for warehousing. Los Angeles developer, Industrial Realty Group, was selected as a backup buyer.
Several groups, including the union that provided hundreds of workers to the plant, have objected to the bankruptcy plan, citing lacking information about how PES would settle all of its debts.
The U.S. Trustee, a bankruptcy watchdog within the Department of Justice, has also objected. The trustee said in a filing PES cannot release itself from its more than $1 billion in debts and other obligations under the plan because it will be liquidating its assets instead of restructuring or selling its business.
PES shut its refinery and filed for Chapter 11 bankruptcy in July following a fire that destroyed a section of its 335,000 barrel-per-day plant near downtown Philadelphia. More than 1,000 full-time and contract workers, many whom are now creditors in the bankruptcy case, were laid off.
One key unresolved issue is who, if anyone, will receive proceeds from up to $1.25 billion in insurance coverage tied to the blaze.
PES’s unsecured creditors have publicly opposed the sale to Hilco, and union representatives held protests against the deal.
The group is pushing for a sale to Industrial Realty Group, which has been in conversations about leasing part of the site to Phil Rinaldi, the former chief executive of PES who wants to restart the refinery. (Reporting by Laila Kearney; Editing by Tom Brown)
Comments