Sustainable Development Goals
PROJECT INFORMATION AT A GLANCE:
Project Status:
Completed technical and commercial evaluation; acquisition not pursued
Organizations Involved:
Klean Industries, Klean Capital, Panama Marine Waste & Oil Recovery Operators, Major Oil Refiners
Services / Equipment:
Design & Engineering, Component Supply, Feasibility Studies, Due Diligence, Supply Chain Management
At the Pacific entrance to the Panama Canal, Klean Industries and Klean Capital evaluated an opportunity to connect marine waste collection, hydrocarbon recovery, storage and an operating micro-refinery. Repeated site evaluations brought process engineering and acquisition analysis together to determine how an established operation could be developed into a stronger circular-oil business.
The assignment demonstrates the breadth of our expertise: understanding what an oil-recovery process can produce, how the material reaches the plant, which customers can use the products and what an investor needs to verify before acquiring the business. We identified modernization potential and completed the evaluation without committing acquisition capital when material aspects of the opportunity could not be adequately substantiated.
The Challenge
Connect a strategic maritime location with a verifiable business
The operation at La Boca, Balboa, occupied a strategically important location beside the Panama Canal’s Pacific entrance and the Bridge of the Americas. It combined access to ship-generated oily wastes with storage infrastructure and an existing micro-refinery.
Marine slops can include oily water, sludge, contaminated fuel, lubricants and tank-cleaning residues. Suitable fractions contain recoverable hydrocarbons, but the composition of each incoming stream affects treatment requirements, product recovery and the value of the resulting oil.
MARPOL Annex I addresses oil pollution from ships, and reception facilities play an essential role in managing ship-generated oily wastes. This creates a service requirement around major maritime corridors and an opportunity to recover usable hydrocarbons from the material received.
Our task was to evaluate how the existing operation could capture that opportunity. The acquisition case depended on the condition and capability of the plant, dependable access to feedstock, the rights supporting the business and evidence connecting physical production with commercial performance.
The Solution
Evaluate the collection business and the refinery as one system
We examined the opportunity across the complete material chain. The marine collection activity supplied the feedstock; storage and handling connected collection with processing; the micro-refinery recovered hydrocarbons for downstream use. Each part influenced the utilization and economics of the others.
The commercial proposition combined an environmental service for vessels with the recovery of petroleum products. We assessed whether the existing assets and operating arrangements could support those activities together, including how a change of ownership would affect continuity.
Apply process engineering to modernization
Through multiple visits, Klean Industries evaluated the physical facility, equipment, feedstock pathway, storage infrastructure and oil-recovery process. The technical review considered improved reception, characterization and segregation of incoming slops, followed by separation, dewatering, filtration, refining and product-quality control.
Those decisions determine how much usable hydrocarbon can be recovered and whether it can be supplied consistently. Removing water and solids, managing contaminants and matching the recovered fractions with customer requirements gave the modernization assessment its commercial purpose.
The work drew on our ability to assess an existing industrial process, identify where integration could improve it and connect potential equipment changes with a useful product. Marine slops already contain petroleum hydrocarbons; this assignment focused on recovering and conditioning those resources for further use.
Connect engineering findings with the acquisition case
We Capital evaluated the acquisition economics, operating rights, represented commercial performance and risks associated with deploying capital. Its work complemented Klean Industries’ assessment of the physical operation and modernization potential.
Together, the teams examined whether the business presented for acquisition could be supported by its underlying assets, material flows and records. This brought the engineering assessment directly into the investment decision.
Make physical production accountable to commercial performance
Our evaluation followed the recovered oil through the business. Collection records needed to support the volumes received. Tank movements needed to support refinery throughput. Processing quantities needed to support recovered-product yields and inventories. Sales, invoices and cash receipts then needed to support the commercial value attributed to those products.
This connection between material balance and financial performance is a practical expression of our combined expertise. It allows an acquisition team to examine how the plant’s physical activity supports the revenue and earnings being represented.
The review also examined the operating rights associated with the location. The facility sat within the Panama Oil Terminal concession area. Site access, relevant operating and waste-management authorizations, and the continuation of those rights following a transaction were therefore central to the acquisition assessment.
The Outcome
Complete the evaluation with a disciplined capital decision
We identified a credible market opportunity and potential to modernize the existing operation. However, sufficient documentation was not made available to substantiate several material aspects of the acquisition to the standard required by Klean Industries and Klean Capital. We elected not to commit acquisition capital.
The outcome was a completed assessment and a clear investment decision. It established the evidence we required before progressing and retained capital for opportunities that could meet that standard.
Subsequent regulatory proceedings concerning the underlying terminal concession provide further context for the importance of secure operating rights. Our decision had already been made on the documentation available during its evaluation.
Bring that experience to the next circular-oil project
Panama shows how we can contribute to a project involving existing businesses and industrial assets. Its expertise spans the recovery process, the collection and product supply chains, modernization planning and the commercial assessment of an acquisition.
That experience complements our work in other circular-oil applications, including the demonstrated co-processing of tyre-derived oil at Geelong Refinery. Different feedstocks and assets require their own processing routes; we connect those routes with industrial customers and a defined commercial purpose.
Explore Klean’s tyre-oil refinery co-processing work with Viva Energy >> GO.
1. Value extends across the maritime supply chain. Collection access, storage, processing and product markets must work together for a marine-oil recovery business to realize its potential.
2. We connect engineering with acquisition economics. The evaluation brought plant capability and modernization potential into the assessment of operating rights, material flows and represented financial performance.
3. A completed evaluation can protect the capital decision. We recognized the opportunity and declined to acquire when the evidence available did not support the required investment standard.
These are selected achievements and lessons. Further technical and commercial insights are available through an engagement with Klean.
WHAT DO THESE LESSONS MEAN FOR YOUR PROJECT?
Bring we into the evaluation of a marine slop-oil, waste-oil or refinery acquisition while the technical and commercial findings can still shape the transaction. Klean Industries and Klean Capital can assess how the processing assets, feedstock arrangements, product markets and investment case fit together.
For an existing operation, the engagement can cover acquisition due diligence, process evaluation and modernization planning. For a new equipment development, a paid Detailed Equipment Quotation (DEQ) establishes the preliminary technical and commercial basis, followed by a Detailed Feasibility Study (DFS) and Front-End Engineering Design (FEED). Confidential project information is addressed within the agreed scope and appropriate confidentiality arrangements.
Discuss Your Oil Recovery Acquisition or Modernization Project with Klean >> GO.
ABOUT THE INFORMATION PRESENTED
This case describes a completed acquisition evaluation by Klean Industries and Klean Capital. Commercial identities and transaction details are limited by confidentiality. The opportunity was not acquired, and the modernization concepts described were assessed rather than implemented by Klean. Further findings are available within a defined engagement and appropriate permissions.
