The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A publicly-traded UK company has increased its equity stake in a proposed Grand Bahama-based oil recovery plant to almost 36 per cent, with the latter believing changes to its development plan will be “commercially beneficial”.

Tim Baldwin, TXO Plc’s chairman, in his annual message to shareholders said Grand Bahama Group (GBG) was “making good progress in developing its operations in the Bahamas”, which aim to recover waste oils and ‘slops’ from ships calling in Freeport.

He added that TXO’s acquisition of a 21.5 per cent stake in Oil Recovery Services (ORS), the owner of technology that reprocesses contaminated oil, had been “invaluable” in helping Grand Bahama Group’s development, indicating the synergies between the two companies,

Mr Baldwin said TXO had increased its equity stake in Grand Bahama Group from 23 per cent to 30.2 per cent in 2013, and subsequently grew it further to 35.67 per cent in early 2014.

The TXO chairman’s message quoted a statement from Grand Bahama Group’s Board, in which the latter said they had put a barge into service to take-off waste oils and ‘slop’ from ships, then bring this to shore for recycling into usable fuel oil.

“The development plans have altered from the sort of development expectations the company had this time last year. This change is believed to be commercially beneficial for the company,” Grand Bahama Group’s Board said.

“This change was mainly due to TXO’s introduction of the ORS technology to the company, and it then contracting with ORS late last year as a technical partner.

“This has led to a business plan requiring less capital expenditure upfront and a modular development programme split into three phases. The company has also been working with all its potential business partners in the Bahamas in assessing their needs for a future phasing of collection contracts.”

Grand Bahama Group added that it had completed the first phase of its development plans in Freeport, namely the collection and reprocessing of waste oils using the ORS technology.

“We are excited by the development plans being implemented for Phase II development (the scaling up of activity on shore) and further out for Phase III (the further refining of the filtered waste oils), and by the further commercial potential on the islands outside of the Freeport developments,” Grand Bahama Group’s Board said.

The company added that its trading subsidiary, Morgan Oil Marine, which specialises in the collection and reprocessing of waste oils, had obtained all necessary approvals to operate the “only port reception facility throughout the whole of the wider region” that had been endorsed by the International Convention for the Prevention of Pollution from Ships (MARPOL).

“In addition to several existing contracts already entered into, Grand Bahama Group last year entered into an arrangement with one of the world’s largest international fleets to receive their used oils and ships slops under MARPOL Annex 1,” the Board statement said.

“Morgan Oil Marine also recently entered into a non-binding Heads of Terms in relation to a substantial oil clean-up project in the region, work in respect of which is scheduled to commence soon.

“Morgan Oil Marine will look to complete all phases of its development over the course of the next 12 months, with construction of Phase II expected to commence next quarter,” Grand Bahama Group’s Board added.

“In order to cope with the greater than anticipated demand, Morgan Oil Marine is looking to secure extra barge capacity. Finally, Morgan Oil Marine has identified sufficient local demand for all of its reprocessed fuel oil for the foreseeable future.”