The Queen Elizabeth II ocean liner glided into Come By Chance harbour on a gusty day in 1973. On board were 1,200 dignitaries, on hand to launch a shiny new oil refinery in the remote Newfoundland community. It also carried the hopes of former Newfoundland premier Joey Smallwood, who had championed the project in a desperate bid to diversify the province's economy beyond fish and forestry.
The over-the-top $1-million party was the brainchild of flamboyant New York financier John Shaheen, who had dreamed up the refinery project and sold the idea to the eager premier. Thirty-six years later, Newfoundland's Come By Chance refinery stands out among the star-crossed projects of Canadian business history - a monument to failed diversification strategies and the hubris of a tycoon. Call it the Curse of Come By Chance.
The project went through a massive bankruptcy and a decade of inactivity, and has been passed around a half-dozen owners. Now, it will likely become the property of the South Korean government, the latest in an exotic cast of characters. Yesterday, the most recent owner, Harvest Energy Trust, agreed to a $4-billion takeover by Korea National Oil Corp. Mr. Shaheen's vision was that the refinery would take Middle East crude and ship its output into the North American market. Within three years, the refinery went broke, triggering a $600-million bankruptcy that was at the time the largest in Canadian history.The tenacious Mr. Shaheen entered the picture again, trying to buy the plant back out of bankruptcy. Finally, it was picked up by Petro-Canada, but the plant remained mothballed for 10 years. It was sold for $1 to a company linked to Cumberland Farms Inc., a New England convenience and gas outlet chain. The new owner restarted operations and invested money, but, inside the business, Come By Chance was reviled as "Fat Chance." In 1994, Vitol Holdings, a Swiss trading company, picked it up.In, 2006, Vitol sold the refinery to Harvest Energy.
Can the South Koreans finally banish the Curse of Come By Chance? "They looked at it, got comfortable with it, and saw it as something that sort of fit into what they wanted to do." CEO John Kahary said.
With files from reporter Nathan VanderKlippeReport Typo/Error
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