Harvest sells Newfoundland refinery to banker

Harvest Operations announced Friday it has reached an agreement to sell its 100% ownership in North Atlantic Refining Ltd. (NARL) to SilverRange Financial Partners of New York, New York. 

The sale includes NARL's Canadian refining and marketing businesses in Newfoundland. 

The refining business is comprised of a 115,000-bpd crude oil refinery in Come By Chance, Newfoundland. while the marketing business includes gas stations and other assets that sell petroleum products to local markets. 

Terms of the sale were not disclosed.

"We are very pleased to announce the sale of NARL, our Newfoundland-based subsidiary. Given Harvest's focus on investment in Canada's upstream business, we remain committed to maintaining and growing our operations in Western Canada," said Mr. John Wearing, Harvest's chief operating officer. 

"At the same time, the Come By Chance refinery will remain an integral part of the local economy in Newfoundland and an important component of the energy supply chain on the Atlantic seaboard," he added.

As part of the transaction, SilverRange will purchase inventories of crude oil and refined products as well as NARL's North Atlantic-branded marketing, marine and home heating businesses. The sale includes 53 North Atlantic and Home Town branded gasoline stations, as well as convenience stores, including 14 Orangestore branded locations.

"This agreement provides a unique opportunity for SilverRange," said Harsh Rameshwar of SilverRange."NARL is strategically located along Atlantic crude oil shipping routes and provides access to petroleum markets in Europe and the US Eastern seaboard. 

"Its clean fuel technology enables the refinery to produce low-sulphur, clean fuels, providing flexibility to refine crudes from many parts of the world."

Separately, SilverRange says it has entered in to a multi-year feedstock supply and product off-take arrangement with a global oil firm, and debt and inventory finance arrangements with major financial institutions.

The NARL transaction is subject to satisfaction of normal closing conditions, as well as regulatory approvals, and is expected to close in the fourth quarter of 2014.