Lawsuits fly over disputed B.C. project

A pair of Red Deer companies are embroiled in a multimillion-dollar lawsuit related to a plant dismantling project in British Columbia that they worked on together.

A pair of Red Deer companies are embroiled in a multimillion-dollar lawsuit related to a plant dismantling project in British Columbia that they worked on together.

Bula Enterprises Ltd. is suing Blue Horizon Contracting, a division of Blue Horizon Energy Inc., for $643,000. Blue Horizon Contracting has responded with a $19-million counterclaim against Bula.

The conflict stems from a February 2011 agreement that Blue Horizon Contracting struck with Chinese companies Ko Yo Development Co. Ltd. and Guangan Lotusan Natural Gas Chemical Co. Ltd. to dismantle a methanol plant and other facilities near Kitimat, B.C.

In May, Blue Horizon Contracting hired Bula to do some of the work.

Blue Horizon Contracting announced in November that Ko Yo and Guangan Lotusan had terminated the dismantling agreement, with more than $4 million still owing.

That matter is now subject to arbitration, with Ko Yo and Guangan Lotusan required to post security in court before the equipment could be released for shipment to China.

Bula says in its statement of claim that it was not paid for services it performed; Blue Horizon Contracting alleges that the work was not completed as required.

Blue Horizon Contracting also says in its counterclaim that Bula encouraged Ko Yo and Guangan Lotusan to terminate the primary dismantling contract, so that it could take over as the main contractor.

It says this resulted in it not being paid $4.5 million for work done, losing a further $5 million that it might have earned under the contract and for subsequent work related to the project, and possibly losing the opportunity to earn $9 million for another unrelated project.

Blue Horizon Contracting is also seeking $500,000 for indirect damages.

Bula’s statement of claim was filed on Jan. 27, and Blue Horizon Contracting’s statement of defence and counterclaim were filed on March 23.

Malcolm McKimm, Bula’s chief financial officer, told the Advocate on Wednesday that his company was in the process of filing a statement of defence to Blue Horizon Contracting’s counterclaim.

Allegations contained in statements of claim, counterclaim and defence have not been proven in court.

McKimm said Bula has now completed the Kitimat dismantling project for Ko Yo and Guangan Lotusan. He said Bula was retained by the Chinese companies after their contract with Blue Horizon Contracting was terminated, and after they considered several companies for the work.

Blue Horizon Energy is a subsidiary of Red Deer-based Blue Horizon Industries Inc. (CNSX:BH). In addition to the dismantling and related work done by its Blue Horizon Contracting division, Blue Horizon Energy explores for oil and gas in Western Canada. Blue Horizon Industries also owns Blue Horizon Bio-Diesel Inc., which is building a pilot bio-diesel manufacturing plant, and has a 74 per cent interest in Blue Horizon Mining Inc., which is involved in mining projects.

Bula has its headquarters in Red Deer with branches in Drayton Valley, Blackfalds and Fort McMurray. It performs services related to the installation, maintenance and dismantling of equipment in various industries.

Meanwhile, Blue Horizon Industries announced last week that Eric Leslie resigned as a director of the company on March 29. Aric Ferguson, president and CEO of private investment firm Zydeco Capital Inc. and a consultant to Blue Horizon Industries, has stepped into the vacant position.

hrichards@bprda.wpengine.com

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Canada’s basketball community mourns Kobe Bryant after helicopter crash

In his 40 years in basketball, nothing Chuck Swirksy has seen compared… Continue reading

Canadian officials say more coronavirus cases expected but risk ‘remains low’

The first Canadian patient diagnosed with coronavirus began showing signs of illness… Continue reading

Quebec police divers find final sunk snowmobile amid search for missing tourists

ST-HENRI-DE-TAILLON, Que. — Divers with Quebec’s provincial police say they have located… Continue reading

Personal spending a party matter, Conservative Leader Andrew Scheer says

OTTAWA — Conservative Leader Andrew Scheer declined Saturday to shed any light… Continue reading

Human remains found in burned Alberta hotel after ice thaws enough to permit search

WETASKIWIN, Alta. — Police in Alberta say that after a week of… Continue reading

Country music fans enjoy free concert at Red Deer mall, ahead of ACMA awards

Fans like to get up close and personal and that’s exactly what… Continue reading

Your community calendar

Feb. 1 A Jump Rope Competition will be held at the Abbey… Continue reading

Bryant’s 13-year-old daughter killed in crash

A source familiar with the helicopter crash that killed Kobe Bryant says… Continue reading

Ex-NBA star Kobe Bryant dies in helicopter crash

LOS ANGELES — Kobe Bryant, the 18-time NBA All-Star who won five… Continue reading

Canucks, Oilers, Flames primed for mad dash in congested Pacific Division

Matthew Tkachuk doesn’t need to be reminded of the Pacific Division’s razor-thin… Continue reading

Canada’s Drury wins silver and Thompson takes bronze at ski-cross World Cup

IDRE FJALL, Sweden — Toronto’s Kevin Drury won silver in the men’s… Continue reading

Officials track passengers on flight with coronavirus patient

Public health officials were working Sunday to track down some of the… Continue reading

Get coronavirus information from credible sources: public health officials

TORONTO — Even before Canada’s first coronavirus case was announced in Toronto… Continue reading

Deputy prime minister asks Opposition not to delay new NAFTA

OTTAWA — Deputy Prime Minister Chrystia Freeland is asking the Opposition parties… Continue reading

Most Read