Transformer oil rerefiner Hydrodec has settled with its insurers on a $20 million claim following the fire damage its Canton, Ohio, rerefinery incurred last December. The British company confirmed that the reconstruction and upgrade of its Canton plant is on schedule for early 2015 completion.
After $1.25 million in deductions to account for excesses, Hydrodec will receive a total cash payment of $18.75 million. Hydrodec collected around $15.7 million in interim payments while working with independent loss adjusters and the insurance company to resolve the claim and is awaiting the final $3.05 million.
The outcome for Hydrodec is positive, CEO Ian Smale told Lube Report. …it confirms that, along with contributions from our partners and Hydrodec, the project to rebuild and expand the plant at Canton is fully funded and expected to start production from an expanded base by the end of the first quarter of 2015.
The reconstruction project, which began soon after the incident, consists of replacing the four production trains that were destroyed and commencing two new production trains. The new units are being built by Zeton, Inc., a pilot plant engineering firm based in Canada. With all six units, the rerefinery will produce up to 45 million liters per year of transformer oil, Smale said. Before the incident, the plant had capacity to produce around 30 million l/y.
This now enables the company to move beyond a difficult chapter in our history and allows us to rebuild with confidence, fully funded, to recapture the growth, momentum and potential of the U.S. transformer oil business interrupted by the incident in December 2013, Smale concluded in a press release issued yesterday.
According to local fire officials early estimates, the fire and explosion last December caused approximately $12.5 million in damages to the processing unit of the transformer oil rerefinery. Fire department, company and insurance officials never ascertained the exact cause of the incident or determined a precise figure for the damage incurred.