By Stephanie Kelly, Reuters
NEW YORK, May 8 (Reuters) – The Trump administration has offered to place a $10 million cap on Philadelphia Energy Solutions’ biofuel blending obligations, effectively slashing the bankrupt refiner’s regulatory liability by more than 70%, according to a proposed settlement between the two parties dated earlier this week.
The deal is intended to free up more cash for the company to pay off its list of creditors, according to the filing.
It marks the second time the U.S. Environmental Protection Agency under President Donald Trump has agreed to waive significant portions of PES’s obligations under the U.S. Renewable Fuel Standard, a law that requires refiners to blend biofuels like ethanol into the fuel pool or buy credits from those that do.
Under the agreement, PES – which entered into bankruptcy after a catastrophic fire last summer – will have to hand over 161,830,963 biofuel blending credits, called RINs, or pay up to $10 million to meet its obligations, whichever comes first, the filing said. The cost of those credits had previously been estimated at $35 million, according to court documents.
The agreement “can reduce the $35 million RINs Retirement Obligation Reserve to $10 million on the Effective Date, which makes funds available to satisfy the creditors’ claims promptly,” the filing said.
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