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Neptune out of krill oil production indefinitely as a result of blast

By Hank Schultz , 12-Nov-2012
Last updated on 12-Nov-2012 at 23:14 GMT

The explosion at the processing facility of Neptune Technologies and Bioressources that killed three workers will keep the company out of krill oil ingredient production for the near future, according to a statement issued by the company.

The explosion, which occurred on Nov. 9 in the early afternoon, also sent eighteen other workers to the hospital, four of whom were severely injured.  The third fatality, a 48-year-old father of three, was pronounced dead on Saturday.

Acetone implicated

The cause of the explosion at the facility in Sherbrooke, Quebec is still under investigation, the company said. Neptune officials are aiding local police and fire officials in the accident probe, as well as aiding in the cleanup. A significant quantity of the highly flammable solvent acetone were at the site and have been implicated in the explosion.

Employees are receiving counseling and other assistance through Canadian government agency Commission de la santé et de la sécurité du travail (CSST), the company said.

“Our hearts are greatly traumatized by this horrible catastrophe that will remain in our minds forever. Our thoughts are with our colleagues and their families,” said Henri Harland, CEO of Neptune.

The explosion destroyed Neptune’s current facility where it produces its NKO Krill Oil ingredient. The company was nearing completion on a new annex to that facility, and the newer portion of the plant apparently did not sustain significant damage.

Business recovery plan

But all of the company’s krill oil ingredients were being made in the old facility, and all of the company’s inventory of crude krill oil was destroyed, meaning for the near term the company is out of production.  The company said it was exploring options to limit the financial damages and to find a way to meet customer demands until it can resume production.

The company said it has insurance coverage for property loss, business interruption and civil liability, but did not specify how much of the eventual damages would be covered, saying such information would be made available soon. A detailed business recovery plan will be released as soon as it is available, the company said.

Trading in Neptune shares was suspended until further notice on both the Nasdaq exchange and the Toronto Stock Exchange.  The decision to halt trading is taken by the stock exchanges themselves, the company said, going on to say that it expects trading will not resume until a plan to recover from the disaster can be made available to investors.

Neptune has several pharmaceutical lines of business, incorporated as Acasti Pharma and Neuro BioPharm.  Neither company is affected by the loss of production at the Sherbrooke plant, the parent company said.

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