Canadian oil company to buy Superior, Wis., oil refinery
SUPERIOR, Wis.—Canadian oil company Husky Energy is buying Superior's oil refinery for $435 million.
Calumet Specialty Products Partners L.P. said Monday it is selling the plant following months of speculation about a potential sale.
Both companies said that while the name on the side of the holding tanks will change, little else will, as all 180 employees will be keeping their jobs.
"We are excited to find with Husky a great home for our employees at Superior and want to thank them for their contributions to our organization over the last few years," Calumet CEO Tim Go said in a statement. "Their dedication and efforts have made Superior an attractive value proposition for Husky, who will retain the Superior employees and will assume the union contract and pension plan."
Local refinery manager Kollin Schade said that during the transition it will be "business as usual."
"Our idea of business as usual is to maintain a safe, reliable operation with a sharp eye toward environmental stewardship," he said.
The sale is expected to close by the end of the year, and the final price will include an additional payment yet to be determined. Calumet said in Securities and Exchange Commission filings that payment would have been $61.5 million if the sale had closed June 30.
Schade said regulatory approvals will determine exactly when the sale will close.
Husky spokeswoman Kim Guttormson said by phone the refinery's asphalt production was a big draw as the company looks to capitalize on increased infrastructure spending across the continent and its own growth in heavy oil production.
Husky vice president of U.S. refining Jerry Miller, visiting Superior from the company's Lima, Ohio, refinery, said Husky's track record should reassure those wary of the change in ownership.
"Since Husky purchased Lima it's been fantastic — they've been good to the refinery, they've been good to the people and good to the community," Miller said.
The 67-year-old Superior refinery can handle about 50,000 barrels of oil per day, which is processed into gasoline, diesel, asphalt and specialty products. The plant was first opened as Lake Superior Refining Co. and was a Murphy Oil refinery from 1958 until 2011, when Calumet bought the refinery and associated assets for $475 million.
The sale to Husky also includes the marine terminal that serves commercial shipping customers.
Planned upgrades at the refinery meant to boost asphalt production and provide greater flexibility will continue, pending state approval, and Husky said the projects could be completed next year.
Investors received news of the sale warmly as Calumet and Husky both saw their stock prices rise Monday — Calumet more than 10 percent.
Calumet, based in Indianapolis, has been in sell mode since taking a loss on a North Dakota diesel refinery in the wake of the recent abundance of cheap oil. The Superior refinery sale is part of the company's goals of "strengthening our balance sheet, lowering our leverage, and freeing up capital resources."
Husky, an oil and natural gas producer and refiner founded in 1938 in Wyoming, is headquartered in Calgary, Alberta, and employs about 5,200 people. Along with Canadian operations and some activity in Asia, Husky owns a refinery in Lima, Ohio, and a 50 percent stake in a refinery in Toledo, Ohio.