Petrogas readies to take over Alcoa Intalco¡¯s Cherry Point aluminium smelter property

Canada's leading midstream oil and NGL (natural gas liquids) marketing and logistics company- Petrogas Energy Corp. is poised to take over Alcoa Intalco Works’ wharf and pier at Cherry Point, Washington, reported sources close to both the companies. The pending buy-out will include the state aquatics lease transfer as well.

Currently, Petrogas accesses the Cherry Point pier with Intalco's permission, as outlined in the state lease. The NGL supplier employs 30 employees at the Ferndale terminal at present.

An agreement has been signed between Intalco and Petrogas which includes selling of property associated with the Ferndale aluminium smelter including the site’s wharf, by the former, updated Intalco spokesman Josh Wilund. The deal, however, will not stop Intalco from operating the smelter, as it will still retain rights to use the pier, he added.

"Intalco will still operate and maintain alumina offloading equipment at the pier,” Wilund said. Petrogas, as per industry reports, has applied for the lease of Aquatic Lands between Intalco and the state of Washington, where the pier in question is housed.

According to the legal representatives of Petrogas, the wharf near Ferndale aluminium smelter is allowed “a maximum of 48 vessel dockings per year for all products (Intalco as well as Petrogas).” The Canadian firm purchased the terminal from Chevron a couple of years ago. It intends to “handle exports and imports of up to 30,000 barrels a day of LPG” and sell propane to the growing US market, it mentioned in an earlier press release.

Petrogas has made investments over US$40 million towards improvements at the facility and has plans for more in the near future. However, the changes proposed by the company may come in the way of further upgrades that would allow for new shipments of unrefined fossil fuels.

“The proposed revisions would make it difficult, if not impossible, to obtain permits to do the necessary maintenance, renovation, or alteration of the dock or other facilities we have here,” said Petrogas manager Andrew Gamble. “The Petrogas Terminal is about 50 years old and it requires constant efforts to ensure compliance with the many regulations that affect it, while also remaining competitive in a highly-competitive global business. It already is very difficult to obtain the necessary permits to do even basic maintenance or renovations, let alone improvements or expansions.”

According to the latest reports, the County planning commission is studying the feasibility of the proposed upgrades by Petrogas. However, a moratorium has been placed by the Council at present, on further applications for improvement or expansion.

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