The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas Oil Refining Company (BORCO) suffered a $20-$30 million hit as a result of Hurricane Matthew, its owner has revealed.

Buckeye Partners, in a recent 10-Q (quarterly) filing with the Securities & Exchange Commission (SEC), said the Category Four storm had impacted both its operational and capital spending costs in the Bahamas.

The New York Stock Exchange (NYSE) listed company, though, said much of the damage inflicted upon its Bahamian asset, now renamed Buckeye Bahamas Hub (BBH), would likely to be covered by its insurers.

“We are currently evaluating the impact of the storm on our BBH (BORCO)terminalling facility, which is located along the northwest Providence Channel of Grand Bahama Island,” Buckeye said in its filing.

“Based on information currently available, we estimate the range of costs expected to be incurred as a result of Hurricane Matthew to be between $20 million to $30 million, comprised of both operating and capital expenditures.

“We intend to seek recovery from our insurers for property damage incurred above our self-insured retentions. However, no assurances can be given relative to the timing or amount of such recoveries.”

Clark Smith, Buckeye’s chairman, president and chief executive, told investment analysts in a subsequent conference call that Matthew’s impact on the former BORCO facility would “not be material” for the company.

He praised the company’s preparations for Matthew as “a safety success story” for Buckeye, given that no employee was hurt, with staff ensuring the BBH site was “fully prepared” for the Category Four hurricane.

Starting his conference call with the hurricane update, Mr Smith said: “I’d like to focus first on what I consider to be a great safety success story for Buckeye.

“A number of our facilities in the Caribbean and on the south-east US coast were recently impacted by Hurricane Matthew, which was a Category Four storm.

“Most importantly, we are happy and thankful to report that all of Buckeye’s employees and their families in Matthew’s path are safe and have been accounted for with no injuries.”

Mr Smith added: “Prior to the storm making landfall, our teams worked diligently to ensure that all of our operations were secure, and that our facilities were fully prepared for the impact.

“Our teams have trained extensively for this type of incident, and we believe this is the primary reason our facilities fared so well. Following the storm, our teams worked quickly and safely to assess the damages and prepare to safely resume operations.”

While Buckeye’s US-based assets all resumed operations within four days, BBH’s location on Grand Bahama ensured that it received the most damage of any of the company’s sites.

“BBH did sustain some damage as a result of the passage of the storm,” Mr Smith acknowledged.

“Our teams are still assessing the financial impact of the damages and recovery efforts, but we currently do not expect such costs to be material.”

Grand Bahama was pummelled by Matthew’s 150 mile per hour winds, which inflicted tremendous devastation on West End and the island’s southern coast communities.

Other industrial assets, in particular the Freeport Container Port, did not fare as well as BBH, and Grand Bahama’s economy has once again been left struggling to rebound following a major hurricane.