Sherritt said the U.S. Treasury's Office of Foreign Assets Control granted a rare authorization that lets the company procure and ship fuel, fuel oil and sulfur for its Moa operation in Cuba. The approval extends to the plumbing that makes shipments possible, covering transport, insurance, banking and related services to move the materials to the island.
Management called this the first in a string of emergency approvals it is seeking alongside U.S. investment firm Gillon Capital LLC to restart mining and processing in Cuba and resume refining in Canada. Sherritt is lining up its first fuel load, though Treasury has not yet published the license itself.
Crucially, this permit does not restart production. Sherritt is pursuing a separate emergency authorization to resume mining and processing, with longer term clearances needed before U.S. investors can take a sizable equity stake and fund a restructuring.
The approval arrives after a bruising summer. Sherritt halted joint venture activity in Cuba in May and stopped refining at its Fort Saskatchewan plant in Alberta in June, moves it tied to President Donald Trump's expansion of sanctions on foreign companies active in Cuba. The fallout tightened cash to the point that the company said it faces severe liquidity constraints and that its ability to continue operating has been put in serious doubt.
CEO Peter Hancock called the fuel approval "extremely unique in terms of US policy towards Cuba," adding, "This doesn't bring us to the finish line, far from it, but it's a clear indication of the direction of travel." He also said "Gillon definitely brings skills and connection with the US government that Sherritt obviously doesn't have."
Sherritt has teamed up with Gillon Capital - the private investment office for real estate magnate and Republican donor Ray Washburne - and Washburne is aiming to take control of the company. At first, Sherritt planned to wind down activities in its Cuban joint ventures following Trump's executive order, but changed direction when Washburne reached out in May. The new OFAC progress could bolster Washburne's hand, especially with Gillon's exclusivity window set to lapse this month.
A rival consortium - comprising Glencore, Texas oil billionaire Albert Huddleston, Sherritt creditor Kyma Capital, and Brevan Howard co founder Trifon Natsis - put forward a plan to inject new funding in return for no less than 55 percent ownership on a fully diluted basis in the company. That consortium says it intends to deal with outstanding claims within the U.S. legal framework.
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One of those claims sits with Moa Bay Mining Co., linked to Citigroup Inc. and rooted in the 1960 expropriation of the mine by Fidel Castro's government. Originally valued at 88 million dollars by a U.S. claims commission, it is the third largest certified claim against Cuba. Under a Sept. 23 agreement, Moa Bay agreed to permit fuel shipments in return for the payment of consent fees by Sherritt or parties acting on its behalf and to refrain from bringing claims against suppliers, banks, insurers and others involved in the authorized deliveries.
Sherritt said that deal received its own OFAC authorization. Washburne has stated in the past that he would purchase the mine claim as one element of his bid for Sherritt.
Another overhang is a July complaint seeking 803 million dollars, filed by Atlas Holdings LLC - the owner of Office Depot's parent - that names Cuba's state power utility and Energas SA, a power JV in which Sherritt owns an interest, as defendants.
Sherritt emphasized that regulatory headway alone will not fix its cash crunch or capital needs. The company remains in discussions with lenders, government bodies and other potential strategic financiers, including Gillon, and cautions that only with additional funding and a full-scale recapitalization will it be able to pay suppliers and fulfill commitments to the broader stakeholder group.
According to Hancock, talks with senior and second lien creditors occur often and have been constructive, even with public disputes about the restructuring. He said Sherritt is not currently negotiating debt haircuts, with conversations focused instead on ways lenders can support the company from here.
In plain English: the OFAC approval opens the fuel tap to Moa and helps clear a path for a rescue, but it stops short of authorizing production. Next up are additional emergency and long haul approvals, plus fresh equity to stabilize the balance sheet. Watch the bidding war - if Gillon's regulatory edge holds, the financing plan that follows will likely set the tone for any recovery in Sherritt's operations and valuation.
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