A Chinese company appears to have pulled the plug on a multimillion-dollar contract involving the subsidiary of a Red Deer company.
Blue Horizon Energy Inc. has been dismantling a Kitimat, B.C. ammonia plant and methanol plant for shipment to China.
In October, it announced that the US $17.5-million deal was being ammended to advance the completion date to Nov. 30 instead of the end of this year, and increase the payment to Blue Horizon Energy to $20.4 million.
But on Monday, Blue Horizon Energy’s parent, Blue Horizon Industries Inc. (CNSX:BH) of Red Deer, said in a release that one of the other parties to the deal had given Blue Horizon Energy a notice of termination.
It said Blue Horizon Energy had already been paid US$15.9 million but would “vigorously enforce its rights and remedies” for amounts still owing, plus further damages.
The work was being done by Blue Horizon Contracting, a division of Blue Horizon Energy.
“Although we are disappointed that we will not be given the opportunity at Kitimat to finish the job for Ko Yo (Development Co. Ltd.), who are experiencing significant logistical issues, we are now able to focus our attention on completing the bid process for a number of new high value dismantling contracts expected to be awarded for execution in 2012,” said Donald Allan, president and CEO of Blue Horizon Industries.
Through its other holdings, Blue Horizon Industries is also building environmentally friendly bio-diesel plants, developing oil and gas wells, and conductng tests on mining properties.