As Mountain Express Oil Co. pushes for a sale to Arko Corp. amid its tumultuous bankruptcy proceedings, the beleaguered convenience and fuel retailer hasn’t been delivering for several unhappy fuel customers.
On Aug. 10, six convenience retailers whose stores are leased from Mountain Express and have exclusive fuel supply agreements with the company received authorization to purchase fuel from other entities after many had gone “well over seven days” without any gasoline deliveries on site, according to documents filed with the U.S. Bankruptcy Court for the Southern District of Texas.
The authorization also lets these retailers disconnect Mountain Express’ credit card processing machines and black boxes from their fuel systems.
The retailers are all based in the Yonkers, New York area. They include Monto Food Mart, Broadway Fuel, Prime Petro, American 1 Gas, Commack Fuel and Riverdale Fuel.
Each retailer received “emergency consideration” by the court, after the pleading noted that “without an immediate and reliable source of fuel, the operators will be forced to cease operations.”
“Through the filing of this Motion, virtually all of the operators have been without fuel for over seven days and are on the verge of shuttering its doors,” the documents noted prior to the motion being approved.
This isn’t the first time these retailers have tried to sever ties with Mountain Express over service interruptions. At the time of Mountain Express’ bankruptcy filing in March, court documents noted that the company would continue operating and managing its properties as debtors in possession. However, after March 18 — the date Mountain Express filed for bankruptcy — these six retailers “were receiving sporadic fuel deliveries,” according to court documents.
All six eventually began purchasing fuel from third-party suppliers at a premium and disconnected their credit carding processing machines and black boxes associated with their Mountain Express fuel accounts. This was all reverted in June, however, as part of a series of court-ordered steps that also included site inspections.
But on Aug. 1, Mountain Express “immediately suspended” all fuel delivery to these retailers, according to court documents. Over the course of the following days, some of the retailers experienced violence and vandalism at their c-stores due to their lack of fuel, according to the filing.
Despite attempts to alert Mountain Express to the “dire situation,” Mountain Express did not offer any assistance or assurance, the documents note.
Also during this time, Mountain Express had been unable to fulfill its obligations under the fuel supply agreements due to inaccurate billing and insufficient fuel allocations, according to court documents.
On Aug. 4, Alpharetta, Georgia-based Mountain Express received a $49 million offer from Arko, the parent company of c-store retailer GPM Investments, to sell all of its assets except for any owned real estate. Although Mountain Express wishes to finalize the deal, its debtor-in-possession lenders have yet to agree to the terms, and the case currently sits in mediation.
