Print |
E-mail to a friend
BUSINESS
5,500-barrel capacity Ky. refinery to be auctioned
SOMERSET, Ky. -- A small south-central Kentucky oil refinery will be auctioned in late September as part of bankruptcy proceedings.
A press release from Edward Durnil, the court-appointed auctioneer at Tranzon Asset Advisors, says the auction for the Somerset Refinery, which has a 5,500-barrel per day refining capacity, is being advertised around the world. Durnil said refinery sales are rare, so he doesn't know how much this one might bring.
"I've heard estimates everywhere from $5 million to $6 million to 'the sky's the limit,"' he told the Lexington Herald-Leader.
The auction is part of a bankruptcy proceeding that began in May 2007.
"There were some cash-flow problems that created a bottleneck in paying crude suppliers," said Ellen Arvin Kennedy, the attorney for the trustee in the case.
The refinery is one of two in Kentucky and 149 in the United states.
As refineries go, Somerset "is certainly on the small scale," said Steve Higley of the National Petrochemical & Refiners Association.
Most of its oil comes from small and mid-size wells in eastern Kentucky and Tennessee.
Other property, including area gas stations, tankers, and refined oil, will be auctioned separately.
Carrol Estes, executive director of the Somerset-Pulaski Development Foundation, said it is important that the refinery, which had employed 178 people, begin operating again.
"We will be at the auction," he said. "Whoever is there, we're going to ... tell them we have some incentives if they put it back in operation."
