Judge Approves Sale of Limetree Bay Refinery to Jamaican Firm, Ending Spirited Effort by St. Croix Energy to Pause Transaction

After more than six hours of hearing arguments from St. Croix Energy, Limetree Bay, and West Indies Petroleum during a motion filed by SCE that sought to adjourn instead of close the auction sale of the refinery in WIPL's favor, Judge David Jones late Tuesday approved the auction that was won Saturday. The auction was held in U.S. Bankruptcy Court for the Southern District of Texas.

The Saturday auction ended with WIPL's $62 million bid, which was superior to St. Croix Energy's $57 million.

A major factor in the judge's decision was the overwhelming support that Saturday's auction result received from many parties involved in the transaction, including the debtor itself, Limetree Bay Refinery. The refinery's attorney, Elizabeth Green testified in support of the sale, stating that Limetree Bay had done its due diligence and that WIPL had already put on the line $10 million since Saturday's outcome.

Goldman Sachs was also in favor of the sale of the refinery to WIPL, and so too was the Unsecured Creditors Committee, a group of Limetree Bay contractors owed over $100 million. The UCC's support for the sale to WIPL Tuesday was a major blow to St. Croix Energy, as the committee had supported the sale to St. Croix Energy as recently as Saturday.

SCE filed the motion Sunday objecting to a number of outcomes, including that it was the original winner after SCE had complied with all the rules. The company also said that notwithstanding West Indies Petroleum's (WIPL) $62 million cash offering, SCE's own offering was better when considering all factors.

During the Tuesday hearing, Michael O'Hara, managing director of Jefferies LLC, which is the investment banker of Limetree Bay, took the stand defending decisions made relating to the process of WIPL's sudden move to participate after the bid had closed, and Limetree Bay's decision to file a motion to reopen the auction which resulted in the auction's reopening and victorious outcome in WIPL's favor.

One of SCE's biggest moments during the hearing was new information that surfaced showing weak financials of West Indies Petroleum. A document that circulated and viewed by the Consortium showed the company was worth roughly $8 million as of Dec. 2020. Limetree Bay argued that this document was placed under seal by the Supreme Court of Jamaica, which had ruled against two shareholders of the company, one of whom Limetree Bay said provided the sealed document to St. Croix Energy.