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New life, jobs for Come By Chance refinery

Facility will convert from crude oil processing to renewable diesel and sustainable aviation fuel production

GLEN WHIFFEN THE TELEGRAM glen.whiffen @thetelegram.com @Stjohnstelegram

For people who have been working at the Come By Chance oil refinery over the last 18 months while it was in warm idle — and for those who worked there and were hoping to get back to work there — a blanket of uncertainty lifted Tuesday, Nov. 30, with the announcement of a new deal to get the refinery up and running again, though the facility will process a much different product.

The new deal will see the refinery converted to process renewable diesel and sustainable aviation fuel.

It comes with the promise of 200 full-time jobs when the refinery restarts — expected next August — and there are hopes to double the number of workers when production ramps up sometime later.

Currently there are about 400 workers at the refinery doing construction work needed for the new refining process.

Worries over whether families would have to uproot and move, and whether there was a future for them in their communities in the province were put to rest.

Glenn Nolan, president of United Steelworkers Local 9316, which represents the refinery workers, received the news Monday night.

“Very excited to receive that call,” Nolan said. “Over the last 18 months we didn’t know where we were going, what we were doing. Today’s news is there’s a future for our members, their communities, and for Newfoundland and Labrador, so we are very happy here today.”

Nolan said the union would contact all its members on Tuesday to inform them of the good news.

Premier Andrew Furey announced Tuesday morning the provincial government had reached a new agreement to help facilitate Cresta Fund Management’s acquisition from Silverpeak of a majority interest in NARL Refining Limited Partnership.

As a result, there are plans to rename the Come By Chance refinery facility as Braya Renewable Fuels (Braya is the name of a rare Newfoundland and Labrador lichen species).

Furey said there’s an “exciting, globally competitive desirable marketplace right now” for renewable diesel and sustainable aviation fuel.

“An exciting product as we move forward into the green transition,” Furey said. “This is a positive step as the province itself looks to transition into a greener economy. It’s wonderful news for the province, and it ensures a bright future for the refinery and its workers.”

Based on the agreement with the province, Silverpeak and Cresta Fund Management have reached their final agreements with respect to Cresta’s purchase of the Come By Chance refinery.

According to Cresta, the first phase of the conversion would change the refinery to a facility capable of initially producing 14,000 barrels of sustainable aviation fuel and renewable diesel daily by about mid-2022.

A second phase will seek to double the capacity of the refinery.

The province also announced that, as part of the deal, there is a new 10-year environmental indemnity in place, which includes a cap on liability for the province that didn’t exist in the previous indemnity, and the new indemnity will require the Come By Chance refinery site to maintain employment levels at no less than 200 (full-time equivalent) positions, maintain fuel (gasoline) supply to the island portion of Newfoundland and Labrador, and maintain operations of the refinery.

Kaushik Amin of Silverpeak said they are celebrating the efforts to make the refinery one of the top five largest renewable diesel projects in the world.

He said before the COVID-19 pandemic shut down oil production at Come By Chance, the refinery had been producing 135,000 barrels of oil per day. Markets collapsed and the search began for a new buyer or investor.

“Along with our agreement with Cresta, and the support of the Government of Newfoundland and Labrador, and the more than 400 workers who are diligently engaged in construction at the refinery site, we are ensuring the long-term sustainability of this facility for the province,” Amin said. “We took a bit of a leap of faith several months ago that the transaction would close, and we started investing in the conversion even before the transaction closed, so we are very far along in the first phase of the project. The first phase of the project will have roughly $400 million of capital … and the second phase of the project, which will double the capacity of the refinery, will probably require several hundreds of millions of dollars more.”

Jim Stump of Cresta, who heads up Braya Renewable Fuels, said so many people and groups, including the provincial government and the union, came together to spark a new vision for the refinery. He said the refinery is 50 years old, but it is in great shape and is strategically located.

“Every single group recognized the opportunity to build on the foundation that’s put together in Come By Chance over the years in a way that would not repeat the ups and downs of the past but would instead chart a new and sustainable future,” Stump said. “Come By Chance can thrive by preparing for the next century and doing that in a way that embraces change and endeavours to reduce the impact on our environment.”

Progressive Conservative MHA Lloyd Parrott said Tuesday’s announcement is good news for the province, but leaves key issues unaddressed.

“Previously, as many as 450 employees have worked on the site during full operation. The 200 full-time equivalent positions needs clarity — how many people will be employed on this site when it is operational?” he said.

“We will continue to advocate for maximum local employment. Secondly, the agreement in principle is missing a local benefits agreement, which would ensure maximum benefits for Newfoundland and Labrador. These are missed opportunities for our province, in what is otherwise a good day.”

Noia (Newfoundland and Labrador Oil and Gas Industries Association) issued a news release welcoming the announcement.

“It ensures the refinery continues operation, employs local people, maintains supply to the island portion of the province, and has the potential to expand, including expansion into other energy sectors such as hydrogen,” the release stated.

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2021-12-01T08:00:00.0000000Z

2021-12-01T08:00:00.0000000Z

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