They are likely to team up again to buy choice Semgroup assets out of bankruptcy.
Aron said no, declared Semgroup in default on its contracts and demanded immediate payment of losses.
He was hired by Semgroup and given subpoena power by the bankruptcy court judge in Delaware.
Along with LORL, they pitched SemGroup ( NASDAQ:SEMG) in March of 2011 and Jos.
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Four days later Semgroup first announced that it had liquidity problems and sold its NYMEX trading account to Barclay's.
Goldman and Aron (where Goldman Chief Executive Lloyd Blankfein got his start) have had a deep connection with Semgroup.
According to a trading summary submitted with court documents, Semgroup had entered into some terribly costly trades with Aron.
But regular hedging apparently wasn't enough to satisfy Kivisto's ambitions for growing Semgroup.
Oil trading consultant Lipow suspects that to lose so much money Semgroup must have ventured beyond mere futures contracts into options.
Aron was Semgroup's biggest counterparty, trading both physical oil flowing through pipelines and paper oil, in the form of options and futures.
Aron sent much of the oil it bought from Semgroup to a Coffeyville, Kans. refinery in which Goldman owns a 30% stake.
Some answers may emerge in late March when former FBI director Louis Freeh releases a report on the trading surrounding Semgroup's demise.
At last Semgroup's stubborn bets have started to pay off--for someone else.
SemGroup Corp shares are currently trading up about 1.7% on the day.
Aron and other counterparties still owed money from Semgroup refuse to pay.
SemGroup Corp shares are currently trading down about 3.7% on the day.
Pipeline industry experts are surprised that Semgroup dared to take short positions so far beyond anything the company could cover with physical barrels.
Kivisto's attorney Tucker and others believe that it was in the Wall Street research for this offering that Semgroup's trading bets became fatally exposed.
In late 2007 Semgroup entered into an oil-trading agreement with Aron.
Semgroup handles more than 500, 000 barrels of crude oil a day in the U.S., operates two pipeline systems and has 6.7 million barrels of oil storage capacity.
Aron and other big oil traders like BP regularly bought thousands of barrels of physical crude oil from Semgroup, which in turn bought the oil from the plaintiffs.
Dozens of small oil and gas producers across Oklahoma and the Midwest are suing Goldman Sachs, BP and ConocoPhillips, claiming the defendants conspired to defraud them out of proceeds for crude oil they delivered just before the collapse of Oklahoma-based pipeline giant Semgroup in the summer of 2008.
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