The Challenge

Philadelphia Energy Solutions (“PES” or “the Company”) was a leading manufacturer of petroleum and petrochemical products based on the East Coast. Headquartered in downtown Philadelphia, the Company operated two refineries south of the city: Girard Point and Point Breeze. The Company experienced a plant explosion that rendered the refinery inoperable resulting in an insurance claim comprised of business interruption losses, property damage, and extra expenses.

The Solution

As financial advisor to the liquidating trust of PES, Opportune prepared an expert report defending solvency and modeled the path forward of a viable go-forward business in defense of a business interruption insurance claim. Specifically, Opportune was engaged to provide expertise on the bankruptcy of the entity and the various options available to the client to reorganize itself had the incident not occurred.

Business Impact

• Wrote and filed an expert report that focused on the Company’s ability to continue to operate a viable business in a COVID-19 environment under the assumption that the plant explosion had never rendered the facility inoperable.
• Performed due diligence on the Company's financial model resulting in modifications ensuring a more accurate financial outlook.
• Examined macroeconomic conditions surrounding COVID-19 during the indemnity period and the effect those conditions would have on commodity prices along with the correlated crack spreads for the Company.
• Conducted a debt and equity market analysis to determine if a further company restructuring would have been necessary.
• Identified possible cash preservation initiatives that the company could have taken in the event of a strained liquidity position.
• Completed a liquidity analysis considering various scenarios the Company would have faced had the plant explosion not occurred.