The assets of Petrotrin’s refinery will be transferred to a new company—Guaracara Refining Company—one of four subsidiaries of a new holding company Trinidad Petroleum Company Limited which replaces the debt-burdened State-owned hydrocarbon entity.
The other companies to fall under the holding company are Paria Fuel Trading Company Limited, Heritage Petroleum and Petrotrin, which remains an entity in name, according to Energy Minister Franklin Khan, “to deal with legacy matters on the table for years to come.”
Speaking at yesterday’s post-Cabinet news conference, Khan said a vesting order was now being worked on to transfer the exploration and production assets of Petrotrin to Heritage Petroleum. That includes the Offshore Trinmar Acreage and all assets involved in E&P.
Another process is underway to transfer the terminal port and pier to Paria and the assets of the refinery will be put into Guaracara Refining Company Limited, which, Khan said, is the company the Prime Minister referred to which will be seeking opportunity attention for the refinery.
Khan shot down reports that a buyer had been sourced for the refinery, saying “there is absolutely no truth to that statement.”
He explained that when Guaracara Refinery Company Limited becomes “operational very shortly, we will be putting out a very broad-based Request for Proposals (RFP) from the entire international market and there will also be a data room at the Point-a-Pierre refinery so that interested parties can come and view the data, view the plans and then make a reasonable proposal to the State.”
Khan said those who are submitting proposals will be free to submit “any business model, whether you want to purchase the refinery, whether you want to have a processing agreement, whether you have a source of crude, whether you have a new business model everything will be open for discussion.” The Oilfields Workers’ Trade Union, the main union representing workers at Petrotrin, has already teamed up with two international companies to bid for a lease arrangement of the refinery assets.
Khan said they were prepared to “accept all kinds or proposals in terms of different business models and different operating strategies to recommence the refinery operation under a different model.”
He said the Government was confident it will get a proposal that would be acceptable and one where the country will no longer have this “albatross around our neck called a refinery.”
Communications Minister Stuart Young explained that while Khan used the word “operationalised” in reference to Guaracara Refinery, “we don’t mean that the refinery will be operating. It is just the refinery assets are being placed in this special purpose vehicle for the purpose of Government receiving proposals.”
Young said proposals received will be “evaluated and a decision taken, we have no horse in the race, we want to see what comes in and then a determination will be made,” he said.
As it now stands, he said from all the advice they had been given “we were told continuing as it is it cannot be viable commercially going forward.”
Young said they had been told the refinery will need an immediate cash injection of between $7 to $8 billion to get the plant and machinery in a state that it can continue and $25 billion to keep the operation going.
"So whoever is going to come with a proposal, those are the elements we need to look at,” Young said.
Meantime, Young also announced that the first shipment of fuel will come into the country between October 22 and 24 and the first crude to be exported from this country will happen in the period October 30 to November 1. Both Young and Khan assured there are adequate fuel supplies in the country.
Khan said, “I want to give the assurance to the country there will be a seamless transition of the supply of liquid fuels to the market, of LPG and of bitumen.”