EPA Makes Ruling On Caribbean Refinery

St. Croix, USVI, Fri. June 18, 2021 (Reuters) – The U.S. Environmental Protection Agency is requiring the troubled Limetree Bay refinery install 18 air monitors in St. Croix, after ordering the plant halt operations last month, the agency said Thursday.

Limetree must develop plan within 15 days to install nine hydrogen sulfide and nine sulfur dioxide monitors on St. Croix, the agency said.

The news comes as U.S. private equity firm Arclight Capital Partners LLC, which invests the retirement savings of Maine teachers, NFL football players and Mayo Clinic doctors, lost hundreds of millions of dollars betting on a troubled Caribbean oil refinery, according to sources and documents reviewed by Reuters.

Boston-based Arclight’s Energy Partners Fund VI, which held a majority stake in the Limetree Bay refinery on St. Croix in the U.S. Virgin Islands, shed more than a quarter of its value in the year ended March 31, according to financial disclosures by a limited partner in the fund.

The fund has since removed the refinery from its portfolio, while investors holding hundreds of millions of dollars of common and preferred equity in the facility have been forced to write it off as worthless, according to pension fund officials and financial disclosures.

Arclight added the refinery to its Energy Partners Fund VI portfolio after purchasing it out of bankruptcy in 2016 for $190 million, hoping to renovate and restart it, along with other investors. But the refinery, mothballed since 2012, never ran smoothly.

Last month, the U.S. Environmental Protection Agency ordered the plant shut for at least 60 days after the refinery sprayed nearby neighborhoods with a petroleum mist.

(Reporting by Laura Sanicola)