Gunvor Group, which is an energy trader, is seriously considering selling the firm’s non-core assets as well as looking for a tactical partner for firm’s refinery in Germany as they attempt a recovery from their yearly loss for the first time which they faced in the year 2018, according to the financial analysists and various other sources.
There are 4 sources that are aware of the development that is taking place; these four sources claimed that the discussions regarding these sales were taken place in several meeting between the major owner of the energy trader, Mr. Torbjorn Tornqvist and their chief lending banks.
These plans, as well as the losses, have not been reported previously.
The firm was faced with losses due to several one-off issues that they would try to deal with more efficiently in 2019.
Some of these issues include writing down of millions of dollars that were due to the abandonment of the refinery’s upgrade in Rotterdam, another write-down was related to the oil block near the Caspian Sea as the firm lost all interest there, as well as due to the provisions for all these open legal cases.
According to the firm’s spokesperson, they have put immense efforts in order to deal with the reason that led to an unprofitable year.
Gunvor had planned to upgrade the plant in Rotterdam using a cooker unit which would eventually result in a relatively higher increase in the output of the products that have a higher value. Installation costs were a couple of million USD. The cost could rise to as much as a billion if the size of the plant is bigger.
Gunvor invested million in the process before they eventually changed their mind. The firm might even have to write the investments off as the anonymous sources informed.
The firm had to allocate around a hundred million US Dollars for the open litigations in China.
In addition to this, the firm faced numerous sanctions in various aspects due to the strict laws in some of the countries it was operating in.