Business

Class action lawsuit filed against Bunker One affiliated Vertex Energy

Vertex Energy investors alleged the firm failed to disclose, ahead of its acquisition of Shell’s Mobile refinery, that it had entered into hedging contracts that capped profit margins on 50%.

Published

2 years ago

March 13, 2023

Admin

Bernstein Liebhard LLP on Thursday (8 March) announced that a securities class action lawsuit has been filed on behalf of investors who purchased or acquired the securities of Vertex Energy, Inc. (Vertex) between April 1, 2022 and August 8, 2022.

Vertex is a significant production partner of marine fuels firm Bunker One after they entered a 10-year marine fuel Joint Supply and Marketing Agreement in 2020 and Bunker One is an investor in Vertex Energy.

The lawsuit was filed in the United States District Court for the Southern District of Alabama and alleges violations of the Securities Exchange Act of 1934.

Prior to the start of the Class Period, Vertex’s primary business involved the collection and processing of used motor oil. In early 2021, Vertex announced that it had reached an agreement to acquire an oil refinery located in Mobile, Alabama from Shell Oil. The refinery was viewed as a “transformative” acquisition for Vertex, expected to significantly increase the Company’s projected annual revenues, from USD 115 million in fiscal year 2021 to a projected USD 4 billion in fiscal year 2023. A key component of the acquisition was Vertex’s plan to convert a portion of the refinery’s 91,000 barrel-per-day output to renewable diesel fuel, which was expected to generate higher profits than the refinery’s conventional gasoline and diesel fuel outputs. The acquisition of the Mobile refinery acquisition was expected to close in early 2022.

To successfully operate the Mobile refinery, Vertex, like other oil refiners, would be required to procure raw crude oil from suppliers, process it into finished products such as gasoline, diesel, and jet fuel, and sell the finished products to distributors who would then sell the products to end users. The difference between the prices at which Vertex acquired crude oil inventory and the prices at which it sold the finished products inventory is known in the refining industry as the “crack spread.” Crack spreads, which fluctuate over time based on domestic and global oil prices, are widely viewed by analysts and investors as the key component of potential profits for oil refiners like Vertex.

Plaintiff alleges that, throughout April 1, 2022 and August 8, 2022, Defendants failed to disclose, among other things, that prior to the acquisition of the Mobile refinery, Defendants had entered into inventory and crack spread hedging derivatives that significantly capped the profit margins on 50% of the Mobile refinery’s expected output over the period April 1, 2022 to September 30, 2022, affecting over 6.5 million barrels of refined fuel output.

On August 9, 2022, before the market opened, Vertex filed with the SEC a Form 8-K that included its second quarter 2022 earnings release and held an earnings conference call for analysts and investors (Q2 earnings call). In the earnings release, and on the call, Vertex disclosed massive losses incurred at the Mobile refinery during the second quarter of 2022. Vertex announced a net loss for the Company of USD 63.8 million. Vertex also announced that adjusted EBITDA for the Mobile refinery, even after adjusting for certain incurred losses, was only USD 63.6 million, compared to the guidance given just three months prior for EBITDA of USD 120-USD 130 million in the second quarter, a total shortfall of 50%. Vertex also withdrew its financial guidance for the remainder of fiscal year 2022 and fiscal year 2023.

On this news, Vertex’s stock price fell USD 6.18 per share, or 44%, to close at USD 7.80 per share on August 9, 2022.

Photo credit: Essow on Pexels
Published: 13 March, 2023

LNG Bunkering

Singapore: MPA launches EOI to expand LNG bunkering services amid growing demand

MPA is seeking proposals to explore scalable solutions for sea-based LNG reloading to complement existing onshore LNG bunkering storage and jetty capacities and e/bio-methane supply as a marine fuel.

Published

1 day ago

December 13, 2024

Admin

The Maritime and Port Authority of Singapore (MPA) has launched an Expression of Interest (EOI) to explore scalable solutions for sea-based liquefied natural gas (LNG) reloading to complement the existing onshore LNG bunkering storage and jetty capacities and the supply of e/bio-methane as marine fuel in the Port of Singapore.

MPA said LNG bunkering in Singapore has grown from 16,000 tonnes delivered in 2022 to over 385,000 tonnes delivered from January to October 2024.

According to the EOI, demand for LNG bunkering is expected to grow further with a growing global fleet of LNG dual-fuelled vessels and competitive LNG bunker prices.

“The EOI seeks to gather proposals on three areas: to scale up sea-based reloading operations, including ship-to-bunker barge LNG operations; to facilitate the supply of LNG alternatives such as liquefied bio-methane; and to develop floating platform concepts to enhance bunkering safety and efficiency,” MPA added.

“The EOI proposals should also include mitigation measures to address the issue of methane slip on a well-to-wake basis.”

Participants in the EOI do not need to be an existing LNG bunkering licensee. Participants are required to propose models for operationalising sea-based LNG reloading starting from 2025. Participants selected will be required to conduct trials in Singapore to validate the proposed solution’s operational feasibility and safety.

“Insights gained from the EOI and trials will inform MPA’s review of the LNG licensing framework, including enhancements to supply to better serve the industry’s bunkering needs,” it said.

Note: Interested parties can visit the MPA website for details and submission guidelines. Proposals must be submitted by 28 February 2025, 1pm (Singapore time).

Photo credit: Manifold Times
Published: 13 December, 2024

Events

Malaysia: 12th PorTech Asia Summit to bring together leaders in port industry

Event, which will be held on 9 to 10 January, will tackle important topics in the port industry including challenges and opportunities for Asian Port Industry as well as sustainable green development of ports.

Published

1 day ago

December 13, 2024

Admin

Malaysia: 12th PorTech Asia Summit to bring together leaders in port industry

The 12th PorTech Asia Summit is now just one month away, with doors opening at Berjaya Times Square Hotel in Kuala Lumpur, Malaysia on 9 to 10 of January.

The summit is organised and hosted by Shine Consultant and co-organised by ASEAN Ports Association (APA).

Themed Smart, Green, Multi-win, the summit will gather leaders and experts in the field of port technology around the world to discuss and promote the innovation and development of the port industry in the digital era.

Some speakers who were invited to share their unique insights and valuable experiences in their respective fields include:

Dato' Monaliza Binti Suhaimi, General Manager, Johor Port Authority
YBhg. Dato' Dr. Vijayaindiaran A/LR.Viswalingam, General Manager, Penang Port Commission
Uematsu Hisataka, President, Port of Yokohama, Japan
Vineet Mahajan, Vice President & Head of Sustainability, DP World APAC
Liu Chang Man, Vice President, Shanghai International Port (Group) Co., Ltd
Sushil Kumar Singh, Chairman, Mumbai Port Authority and Deendayal Port Authority
Mazlim Bin Husin, Chief Commercial Officer, Kuantan Port
Mohd Khairul Azizat Johari, Head of Facility Management, Johor Port Berhad, Malaysia
Budi Cahyono, Vice President Director, PT Jakarta International Container Terminal
Eun-kyoung Park, General Manager, Overseas Business Department, Busan Port Authority
Ivan Fantin, Vice President, Chief Lean Officer, APM Terminals, Maersk
Desmond Ong, Chief Digital Officer, Jurong Port, Singapore

Agenda

Day 1: 9 January

Session 1: Challenges and Opportunities for Asian Port Industry

Session 2: Blending Old and New: Port Construction and Upgrade Projects

Day 2: 10 January

Session 3 Forum: Efficiency Improvement and Business Innovation Driven by Digital Intelligence

Session 4 Forum: Green & Safety - Building Sustainable Development Capacity of Ports

Shine Consultant is inviting representatives from government and port authorities, industry associations, port terminal owners, digital solution providers, port machinery and equipment suppliers, research institutions, professional service organizations, and other relevant institutions to attend the summit.

Participants will have the opportunity to exchange ideas with industry leaders and jointly explore the future trends and innovative pathways of the port industry.

Interested parties may contact:

Jenny Wu
Tel: (86 21) 6095 7179
E-mail: [email protected]
Company: Shine Consultant International Ltd.

Or scan QR code to register. Interested parties may also register here.

qr code portech

Photo credit: Shine Consultant
Published: 13 December, 2024

LNG Bunkering

Wärtsilä wins LNG systems order for Vitol bunkering newbuild vessel

Firm will supply cargo Handling and Fuel Gas Supply systems for a new 12,500 m3 LNG bunkering vessel currently being built at Nantong CIMC Sinopacific Offshore & Engineering shipyard in China.

Published

1 day ago

December 13, 2024

Admin

Wärtsilä wins LNG systems order for Vitol bunkering newbuild vessel

Wärtsilä Gas Solutions, part of technology group Wärtsilä, on Friday (13 December) said it has won a contract to supply Cargo Handling and Fuel Gas Supply systems for a new 12,500 m3 LNG bunkering vessel.

The vessel is being built at the Nantong CIMC Sinopacific Offshore & Engineering shipyard in China, for global energy company Vitol.

“Wärtsilä’s ability to engineer, design and deliver a complete system, including the Boil-Off Gas (BOG) management, integrated fuel supply, custody transfer and bunkering transfer systems, was central to the contract award,” Wärtsilä said, adding the order was booked by the company in Q4, 2024.

Richie Zhu, Sales Manager, Wärtsilä Gas Solutions, China, said: “LNG is today an important marine fuel and is rapidly becoming the preferred choice for owners and operators seeking more sustainable fuel options. The market for LNG bunkering vessels is increasing in line with this trend, and we have established a leading position in supplying modern and reliable systems that optimise overall cargo handling efficiency for such vessels.”

Manifold Times previously reported Vitol securing three LNG Bunkering Vessels (LNGBV) through its shipping company, Vitol International Shipping Pte Ltd (VIS).

The vessels were secured via a seven to ten year time charter agreement with Avenir LNG Limited (Avenir) and an order for two vessels at the CIMC Sinopacific Offshore & Engineering Co. Ltd shipyard in Nantong, China.

The time charter agreement with Avenir is for one newbuild 20,000 m3 LNGBV. The time charter will commence at delivery from the shipyard in China in Q4 2026 and will serve a period of seven years with options to extend up to ten years in total.

Vitol also ordered one 12,500 m3 and one 20,000 m3 LNGBV at the CIMC SOE shipyard in China. The vessels will be delivered in Q4 2026 and Q3 2027 respectively.

Photo credit: Wärtsilä
Published: 13 December, 2024