Greka - History

History

The oldest component firm making up Greka, Saba Enterprises, was founded in 1981. Greka itself was originally named Kiwi III, Ltd, and was created as a Colorado corporation in 1988. This firm, renamed to Petro Union, Inc., filed for bankruptcy in 1996. In 1999, Randeep Grewal, the current owner of the Greka companies, acquired the assets of Saba Petroleum, changing the company's name to Greka; and previously in 1998, with his newly-purchased Horizontal Ventures, which was then a private entity, he acquired the assets of Petro Union, which was just then emerging from its 1996 bankruptcy filing in Indiana. Grewal formed Greka Energy by combining these various entities in 1999.

In an October 2000 interview with Wall Street Transcript, Randeep Grewal stated that the company's motto was "Working for Profits": "... are the three words that define what keeps me excited and that's primarily what each of my employees and I focus on. Being profitable drives every decision we make, hence our company’s slogan 'Working for Profits.'" While a publicly traded firm, Greka continued to grow, acquiring Windsor Energy US Corporation and Rincon Island Limited Partnership in 2002, thereby adding Rincon Island in Ventura County to their portfolio; and in that same year they acquired the properties of Vintage Petroleum in northern Santa Barbara County, which included about 110 producing wells on portions of five oil fields, principally in the Santa Maria Valley and the surrounding hills.

During the time that Greka was a public company, it had holdings worldwide, including in Canada, Colombia, Indonesia, and China, in addition to its United States operations, which at the time of its creation in 1999 included oil fields and other facilities in California, Texas, New Mexico and Louisiana.

Randeep Grewal took the firm private in 2003. Until that year, Greka was traded on the NASDAQ as GRKA. Grewal bought all outstanding shares for $6.25 per share, which was a 69% premium over the $3.70 per share closing price, for a total of about $32 million. Grewal split out several entities prior to filing Saba for bankruptcy in 2005. Three parts of Greka, including Greka, Petro Union, and Horizontal Ventures, were included in that filing, in which the firm in its petition estimated assets of $0–$50,000 and estimated debts of $10–$50 million. Neither the producing operations – which include several leases in Santa Barbara County, Rincon Island, Orange County, and Kern County – nor the asphalt plant were included in this liquidation filing.

Greka appointed former Greka CFO,Andrew deVegvar as president in January 2008. Shortly after beginning his new job DeVegvar began a new "Greka Green" campaign to counter the perception that the company was environmentally careless. The company also hired corporate security consultant, Tom Parker, a former Sr. FBI agent and Deputy Chief of the Los Angeles Regional Office of the FBI, in order to investigate alleged sabotage at their facilities in late 2007 and early 2008 seemingly timed to coincide with the political meetings regarding Greka.

On August 20, 2008, Greka settled a lawsuit brought against them by the trustees of the owners of the mineral rights to several leases on the Cat Canyon Field. They paid $5 million to the trustees through Wells Fargo Bank and Union Bank. At issue was the transfer in 2002 of production from Vintage, the original operator hired in 1992, to Greka, which allegedly took place without the trustee's permission. According to Greka, the operations on the three leases on the field were only a small part of their local operations.

On January 21, 2009, Greka sued the County of Santa Barbara, alleging that it used its "repeat offenders" rule to shut down non-polluting facilities along with polluting ones, a situation Greka maintained was unconstitutional. The County agreed with Greka that the retroactive application of the rule would be unconstitutional. The remaining claims were dismissed by a U.S. District Court.

Citing declining oil prices and a deteriorating economic climate, Greka laid off 30 people in March 2009, representing about twenty percent of its staff in the Santa Maria area.