Pétromont Inc., CCAA

Pétromont Inc., a Montréal, Québec-based petrochemical company, obtained CCAA protection on March 11 to facilitate a structured wind-down of its operations, dispose of remaining assets, and fulfill outstanding environmental obligations.

Established in 1980, Pétromont was a key player in Québec’s petrochemical sector, specializing in the production of materials used in the plastics, packaging, automotive, and construction industries.

Despite more than 25 years of success, the company faced financial difficulties beginning in 2007 due to currency fluctuations, rising raw material costs, and increasing international competition.

Pétromont suspended operations in 2008 and permanently shut down its Varennes and Montréal-East plants in 2009. Since this time, the company has focused on liquidating assets, settling commercial and employee obligations, and addressing extensive environmental rehabilitation requirements mandated by the Québec Ministry of the Environment.

The company has completed the sale of its Varennes site to the City of Varennes following an extensive decontamination process but still retains a contaminated parcel of land in Montréal-East. Pétromont remains responsible for groundwater monitoring and remediation activities at both sites until at least 2029.

With liabilities exceeding $249 million and ongoing environmental costs, the company is insolvent and unable to meet its remaining obligations. The purpose of the CCAA proceedings is to implement a claims process, finalize environmental obligations, and identify a resolution for the remaining contaminated land in Montréal-East.

Deloitte is the monitor.

Counsel is McCarthy Tétrault for the company and Stikeman Elliott for the monitor.