Nothing Venture 4

Before I get into the first Joint Venture meeting I have to remind readers that this series of posts is not specifically about our worker attempt to buy the Calgary Refinery from Imperial Oil – it’s about the novel I later wrote about the affair and what I learned about writing as well as life from the whole experience. At the moment, I’m giving you the true life plot that formed the basis of the novel – well, two different drafts – that I wrote a few years later. This thread starts below at Nothing Venture 1.

The meeting with our potential partner took place in the boardroom of Mohawk Oil Company Ltd behind their service station on Fairmount Drive, Calgary. (The company was bought up by Husky Oil in 1998, and last time I looked the service station had gone.) We met Donald Skagen who was the Executive Vice President, the man who actually ran the company at that time. He told us that Mohawk, which had a significant number of gas stations in Western Canada, was looking to expand further and acquiring a refinery was their next step up.

He proposed developing a joint venture with Calgary Refining, the employees’ company, to pursue an investigation of the refinery economics with a view to offering to buy the facility from Imperial. Mohawk would be the manager and operator of the refinery while Calgary Refining would be the employee and staff contractor. We would be given good terms for our worker owners to acquire ownership shares in the joint venture.

There are a number of other details that might not interest the reader looking for the outcome and the novel, so I’ll mention that the workers’ first investors were 20 guys who bought in to a syndicate that financed our part of the purchase plan. These were the minority group that actually had money on the line, and we three directors were the first ones on the hook.

When Mohawk initially approached Imperial about doing a feasability study of the refinery with a view to making an offer for it, they were well received. The manager in charge of all the Imperial refineries in Western Canada had been a refinery manager there previously and had a soft spot for the old place. Imperial threw open a great number of the technical and production records and at each subsequent meeting with Don Skagen he was able to tell us that the purchase looked more and more to be a sound business investment.

We saw all kinds of advantages to the community, Calgary would retain the industry; and having an independent refinery, could look forward to price competition between the Oil Companies locally. We saw the refinery jobs saved and a future ownership stake that promised us dividends as well as our wages. Some of the units in the refinery were irreplaceable, the Alkylation Unit –  that I progressed through operations to become shift operator for – had been built during WWII to provide iso octane, the high octane component in the aviation fuel that wartime aircraft needed. This was still in demand for high performance automobiles as well as the significant number of aircraft  in service at the time that were powered by piston engines. It also seemed a given that Imperial Oil’s shareholders would receive a much better price for the facility in running order than they would get for it as scrap metal.

For almost a year, the joint venture’s prospects seemed excellent as a number of steps toward the eventual purchase were attained. Then one day, Bill, the worker company’s president, phoned the Imperial Oil manager of western refineries about something and was told, “Oh, Mr Sand’s not available. He’s in New York.” “What about Mr Sirois, the Vice President in charge?” “I’m afraid not. He’s in New York as well.” We soon learned what that meant, and I’ll tell you next time.

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