Peninsula's petroleum users grease past Pettit Oil's sudden closure
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Keith Thorpe/Peninsula Daily News
Caution tape surrounds the fuel pumps at a station on Marine Drive in Port Angeles. Pettit Oil provided the fuel for the station before the company's closure.
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Charlie Bermant/Peninsula Daily News
Jefferson Transit General Manager Tammi Rubert said the system did not feel any pinch from the Pettit shutdown.

By Paul Gottlieb
Peninsula Daily News

PORT ANGELES — Officials with the North Olympic Peninsula's two ports and transit agencies are weathering fuel and heating-oil uncertainties created by the closure of Pettit Oil.

Meanwhile, the company's creditors await their turns in bankruptcy court in Tacoma.

Managers with the ports of Port Angeles and Port Townsend, as well as with Clallam Transit and Jefferson Transit agencies, said Tuesday they have filled the gap — at least temporarily — for fuel and heating-oil supplies caused by Pettit's Chapter 7 bankruptcy petition.

The Lakewood-based company filed the petition Jan. 17 to seek protection from creditors one day after it ceased operations.

“There has been no interruption in fueling services, and interim measures allow flexibility in maintaining access to fueling services for the foreseeable future,” Port of Port Angeles Public Works Manager Randy Brackett told port commissioners at a meeting this week.

The port purchased a 1,600-gallon, 1967 GMC fuel truck — “a tank on wheels,” Brackett called it — from Rite Brothers Aviation Inc. that was filled by Masco Petroleum of Aberdeen.

Pettit still owes the port $2,513 for December and January rent for less than an acre it leases for a large, moveable container on Marine Drive, port Property Manager Tanya Kerr said Tuesday.

Masco, distributing out of its own facility in Forks, has gained about 1,000 new residential and business customers in Western Washington since Pettit's shutdown, company Vice President Sean Mason said.

Pettit also supplied heating oil for buildings in the Port of Port Townsend's picturesque Point Hudson buildings, port Executive Director Larry Crockett said.

The port has contracted with Cooper Fuel and Auto Repair of Bremerton to replenish Point Hudson on a temporary basis.

Crockett did not know who will supply fuel to the commercial fishing boats at Port Townsend Boat Haven that will leave for Alaska in May and June.

“This gives us a little bit of time to work this out,” Crockett said.

Jefferson Transit did not feel any pinch from the Pettit shutdown, Manager Tammi Rubert said Tuesday.

A transit system emergency that was declared Jan. 20 at the Jefferson Transit board meeting allowed the agency to bypass bidding requirements and buy fuel immediately, Rubert said.

Clallam Transit had 46 fuel cards through Pettit, which provided daily fueling in the West End, agency Maintenance Manager Kevin Gallacci said in a memo to General Manager Wendy Clark-Getzin.

The agency recently finished converting the portion of the van-pool fleet that originates in Port Angeles to propane, Gallacci said.

By Jan. 18, the agency ordered new Pacific Pride fuel cards from Associated Petroleum Products Inc. of Tacoma, which supplies Clallam Transit with bulk diesel fuel.

Pettit owns facilities in Port Angeles, Forks, Port Townsend, Lakewood, Hoquiam, Everett and Bremerton, including offices and unattended card-lock fueling locations in Port Angeles and Forks, and a tank farm in Glen Cove Industrial Park near Port Townsend.

The cardlock locations were used by agencies such as Jefferson Transit, which since Pettit's shutdown has applied to be part of U.S. Bank's Voyager cardlock fueling services.

All property owned by Pettit — “the debtor” in court filings — has been turned over to Chapter 7 Trustee Kathryn Ellis.

“At this point, the debtor no longer exists in any real or practical sense,” Olympia attorney Brian Budsberg of Budsberg Law Group PLLC, representing Pettit, said in a Jan. 23 court filing.

Budsberg's motion with the court to withdraw as Pettit's counsel is scheduled for a Feb. 13 hearing.

“There is no reason for Budsberg, as debtors counsel, to remain engaged and involved,” the motion states.

Pettit employed 125 full-time employees with an average monthly payroll of $725,000.

Company President Chris Sather said in a court filing that they were paid through Nov. 15, or 10 days before Pettit filed for bankruptcy protection from creditors.

Pettit had 10,000 customers, including individuals with prepaid heating-oil accounts.

Mason said he had received possibly 50-100 calls from prepaid card holders in Pettit's Western Washington coverage area.

A creditors' meeting is March 10 in federal bankruptcy court, 1717 Pacific Ave., Tacoma.

Ellis has filed an application with the court to hire $440-an-hour Seattle lawyer Deborah Crabtree of Foster Pepper PLLC on retainer to help process claims.

The bankruptcy court hearing is at 9 a.m. Thursday.

“I have been deluged with inquires from various attorneys relative to their interests in the debtor's assets,” Ellis said in a court filing.

Ellis and Sather did not return calls for comment Tuesday.

Bankruptcy court documents state that KeyBank is owed $11.3 million and U.S. Bank $8.8 million as Pettit's largest creditors.

A total of 49 creditors were listed.

Pettit was “financially too weak to be profitable” after selling a portion of its business and buying a heating-oil supplier in February 2013, Budsberg said in a court filing.

Pettit bought the heating-oil and commercial fuel lubricants distribution assets of Tacoma-based SC Fuels.

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Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 5060, or at pgottlieb@peninsuladailynews.com.

Last modified: January 28. 2014 7:26PM
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