O.W. Bunker, committee request enforcement of oil sale approval order

By Caroline Salls

Pittsburgh, Dec. 31 – O.W. Bunker Holding North America, Inc. and its official committee of unsecured creditors asked the U.S. Bankruptcy Court for the District of Connecticut to enforce its order approving the sale of oil at its Vopak terminal and related assets, according to a Dec. 30 court filing.

The company and committee are also asking the court to impose sanctions against winning bidder Aegean Bunkering (USA), LLC for costs and expenses incurred in preparing, filing and prosecuting the compliance motion.

O.W. Bunker and the committee said Aegean submitted a binding offer for all of the fuel oil at issue at a specific price per metric ton of each relevant grade of fuel oil.

According to the motion, the parties recognized that there would be a true-up of the final purchase price at the specific per-metric ton price in Aegean’s winning bid once the precise amount of the oil to be delivered was determined.

At the initial closing, based on the estimated amount of fuel oil, Aegean paid $11.01 million.

O.W. Bunker said it turned out that there was more oil at the terminal than estimated, requiring payment of an additional $885,000, but Aegean refused to purchase the additional oil unless it could pay the then-market price, which was lower than the per-metric ton price bid approved at the auction and by the court.

“Now that the quantity of the Vopak oil has been determined to exceed the original estimates – a possibility well-known to Aegean and all other bidders – Aegean refuses to close on its agreement to purchase all of the Vopak oil at its final bid price,” the motion said.

“Aegean has every incentive to stall and little to lose by waiting for resolution of this motion (unless the court also awards the requested sanctions, because while it delays closing the fuel oil market may move toward its position and beyond, allowing it to profit.

“If the market increases above Aegean’s bid price there may be no legal authority to compel Aegean to pay the higher amount.”

The company and committee said the sale order clearly calls for Aegean to buy all of the fuel oil at the Vopak terminal, even amounts in excess of earlier quantity estimates, at the prices indicated in Aegean’s winning bid.

A hearing is scheduled for Jan. 6.

O.W. Bunker is an independent distributor and reseller of marine fuel and is based in Denmark. Its U.S. subsidiaries filed bankruptcy on Nov. 13 under Chapter 11 case number 14-51720.

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