THE Trinidad and Tobago government Thursday said it had accepted the recommendation of an evaluation committee that recommended Oando PLC, one of Africa’s largest integrated energy solutions provider, to be preferred bidder for the lease of the Guaracara refinery.
Energy and Energy Industries Minister, Stuart Young, in a lengthy presentation to reporters at the post-cabinet news conference, said the decision was largely based on Oando’s strong financial track record, particularly its US$1.5 billion acquisition of ConocoPhillips’ assets in Nigeria.
The evaluation committee noted that both Oando and the CRO Consortium -comprising of three Trinidadian companies; INCA Energy, an American company – had similar capabilities in operating refineries, but Oando’s ability to secure substantial financing in the upstream oil sector gave it an advantage.
“Both of these things were explored and the evaluation committee recommended to Cabinet that Oando… be the preferred bidder for the lease of the Guaracara refinery,” Young said.
He said the evaluation committee presented that to the Cabinet committee chaired by Housing and Urban Development Minister, Camille Robinson-Regis and today the Cabinet took certain decisions.
“We have also noted the proposal for the lease type commercial arrangement proposed which seeks which sees the Guaracara refinery operating alongside Paria Fuel Trading Company Limited by way of granting access to Paria’s associated logistic assets via a commercial arrangement… which lease arrangements would allow the government a number of things.”
He said these include retaining ownership while granting usage rights to the referred bidder to generate consistent revenue.
“So we are not giving up Paria,” Young said, noting that there were some entities along the way which wanted to get hold of Paria’s bunkering purposes and were not interested in restarting the refinery.
Trinidad Petroleum Holdings Limited (TPHL), owns Guaracara Refining Company Ltd, which operates the country’s only petroleum refinery. It also owns the Paria Fuel Trading Company subsidiary, which imports refined petroleum products, and stores and distributes them domestically.
“We the government was adamant in our discussions with the evaluation committee that we have to protect the assets of Paria to also always ensure that we can provide domestic fuel to our population and to make sure that anybody really interested in restarting the refinery doesn’t just take Paria’s assets.”
Young said that this is “one of the problems” the company formed by the Oilfield Workers Trade Union (OWTU) to bid for the refinery had faced.
He said the preferred bidder will also reduce the burden on the state to preserve and upgrade the asset as well as “create avenues for flexibility in the future and a number of other areas.
Young said Cabinet also decided to inform TPHL of a non-objection to the recommendation of the evaluation committee and its proposals for the sale or lease of the refinery.
‘We also agreed that TPHL should consider the recommendations of the said evaluation committee and proceed accordingly,” Young said
The refinery of the state-owned PETROTRIN was closed in 2018 due to a lack of oil and high costs of importing oil. The government restructured the company and invited proposals to restart the refinery.
The government defended the decision insisting that the company was losing billions of dollars annually. (CMC)
How long thereafter, the refinery would be in full operation after ALL the assets within the company are accessed and accepted by the OSHA, EMA and other regulatory agencies for safety and environmental protection purposes