(Adds comments from developer, background throughout)
By Laila Kearney
NEW YORK, June 26 (Reuters) - Hilco Redevelopment Partners closed on its $225.5 million deal with Philadelphia Energy Solutions on Friday, the developer said, acquiring the site of the largest and oldest East Coast oil refining complex.
PES put its 335,000 barrel-per-day Philadelphia refinery up for sale and filed for bankruptcy after a fire and series of explosions tore through the plant last summer.
HRP plans to turn the 1,300-acre site, which was used for oil refining for the past 150 years, into a mixed-use industrial park.
“We see the investment as a once-in-a-generation investment. These 1,300 acres are very strategically located from a supply chain perspective on the East Coast,” said HRP Chief Executive Officer Roberto Perez, noting the site’s rail yards, access to waterborne shipments and pipeline connectivity.
Cleaning up the deeply-contaminated refinery land will fall on HRP and former refinery owner Sunoco. The cost is expected to be in the hundreds of millions of dollars, Perez said.
HRP is not considering restarting any portion of the plant, but it is retaining a tank farm and other energy logistics that came with the sale, Perez said.
“The Schuylkill River Tank Farm and its connectivity to pipelines - we see it as a tremendous asset,” Perez said.
The next phase of the project will include demolishing the massive refining complex. Rebuilding the site is expected to take about 10 years.
PES filed for bankruptcy and shut its refinery after a series of explosions and fire at one of its gasoline processing units on June 21, 2019. More than 1,000 full-time employees were laid off without benefits, including 640 United Steelworkers members.
Philadelphia Mayor Jim Kenney applauded the sale.
“The action creates jobs, ensures the future commercial viability of the site, and decreases the former refinery’s environmental impact,” Kenney said in a statement. (Reporting by Laila Kearney)