The owner of the Limetree Bay oil refinery in the U.S. Virgin Islands is in early restructuring talks with creditors after pollution incidents and a cash crunch shut down the troubled plant indefinitely, WSJ Pro Bankruptcy reported. Limetree Bay Energy LLC said on Monday the St. Croix-based refinery would close indefinitely, clouding its future and throwing into doubt a crucial economic driver in the struggling U.S. territory. Private-equity investor EIG Global Energy Partners controls the refinery, which previously went through bankruptcy in 2015, emerged under private ownership and started refining fuel again in February after a nearly decade-long hiatus. EIG had hoped to succeed where the facility’s previous backers couldn’t, but had to idle the refinery last month after a flaring incident rained oil droplets on nearby residential areas. Limetree Bay abandoned hopes for a quick restart after failing to secure the necessary funding, the company said Monday. Creditors that financed the refinery are now bracing for losses and evaluating their options, people familiar with the matter said. EIG didn’t immediately respond to a request for comment. Without a clear path to resuming operations, Limetree Bay has engaged law firm Gibson Dunn & Crutcher LLP to handle restructuring negotiations. Lenders to the refinery, including the Abu Dhabi Investment Authority, have tapped law firm Akin Gump Strauss Hauer & Feld LLP. Read more.
