Caribbean Petroleum eyes $24 million settlement with Chartis Insurance

By Lisa Kerner

Charlotte, N.C., March 30 - Caribbean Petroleum Corp., Caribbean Petroleum Refining LP and Gulf Petroleum Refining (Puerto Rico) Corp. asked the court to approve a settlement, release and buyback agreement with Chartis Insurance Co. - Puerto Rico (formerly known as American International Insurance Co. of Puerto Rico), according to a Wednesday filing with the U.S. Bankruptcy Court for the District of Delaware.

A hearing is requested for April 13.

Under the agreement, Chartis, an insurer under certain of the debtors' third-party liability insurance policies, will buy back its policies and pay about $24 million to the debtors' estates, the filing said.

Without the settlement, Chartis would pursue litigation against the debtors regarding a coverage dispute related to the catastrophic explosions, fires and resulting damage that occurred at Caribbean Petroleum's facilities in Oct. 23, 2009.

As a result of the explosions, the company filed for bankruptcy.

Caribbean Petroleum, a Bayamon, Puerto Rico, oil company, filed for bankruptcy on Aug. 12, 2010. Its Chapter 11 case number is 10-12553.

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