Asha Javeed

Lead Ed­i­tor In­ves­ti­ga­tions

asha.javeed@guardian.co.tt

Ni­Quan, the trou­bled gas-to-liq­uids plant which went of­fline in Sep­tem­ber, is now in de­fault of its US$150,000,000 mil­lion fa­cil­i­ty.

Hun­dreds of mil­lions are owed to lenders in­clud­ing some of the coun­try’s top banks and cred­it unions and 70 jobs are on the line.

The com­pa­ny’s fa­cil­i­ty agent, Re­pub­lic Bank Lim­it­ed (RBL), along with oth­er note­hold­ers passed a res­o­lu­tion on No­vem­ber 7, to ap­point a steer­ing com­mit­tee among note­hold­ers to es­tab­lish a plan for the now-de­funct plant mov­ing for­ward.

Co­in­ci­den­tal­ly, for­mer per­ma­nent sec­re­tary of the Min­istry of Fi­nance Al­i­son Lewis, who sat on the RBL board, re­tired last month. Lewis re­mains the vice chair­man of Ni­Quan.

The Sun­day Guardian un­der­stands that RBL’s ex­po­sure to Ni­Quan is about US$22 mil­lion.

The plant was used as col­lat­er­al as the com­pa­ny sought to raise mon­ey over the years to make it op­er­a­tional.

The Sun­day Guardian un­der­stands that as a fa­cil­i­ty agent, giv­en that Ni­Quan has now de­fault­ed on its two fi­nanc­ing in­stru­ments–a short-term note in­stru­ment and a mort­gage deben­ture, dat­ed Au­gust 27, 2021, which is US$150,000,000 se­cured mort­gage which was due by 2022–the note­hold­ers can take what­ev­er ac­tion they deem fit for the plant mov­ing for­ward.

In Oc­to­ber 2023 in a press state­ment, re­gion­al rat­ing agency Cari­CRIS low­ered Ni­Quan’s cred­it rat­ing to B- which im­pact­ed its abil­i­ty to raise any short-term fund­ing.

Cari­CRIS has warned that it could be fur­ther low­ered if Ni­Quan does not suc­cess­ful­ly re­fi­nance its short-term debt by the end of the year.

Cari­CRIS said the low­er­ing of the as­signed rat­ings re­flects Ni­Quan’s in­abil­i­ty to at­tain full com­mer­cial op­er­a­tions at the name­plate ca­pac­i­ty by Sep­tem­ber 30, 2023, (iden­ti­fied as a fac­tor that could lead to a low­er­ing of the rat­ing in their March 2023 re­port) and the ter­mi­na­tion of the gas sales con­tract by Trinidad and To­ba­go Up­stream Down­stream En­er­gy Op­er­a­tions Com­pa­ny Lim­it­ed (TTUDEO­CL) and which has be­come sub­ject to le­gal pro­ceed­ings by Ni­Quan.

Cari­CRIS said it will con­sid­er re­vis­ing its rat­ings up­ward if Ni­Quan can re­sume a long-term GSC, to­geth­er with suc­cess­ful re­fi­nanc­ing of the ex­ist­ing Short-Term Note In­stru­ments (STNI) in­to a longer-term fa­cil­i­ty.

 “We may, how­ev­er, fur­ther low­er the rat­ings if the STNI is not re­fi­nanced or ex­tend­ed by De­cem­ber 31, 2023, or if any oth­er cred­it neg­a­tive events oc­cur be­fore that date,” it had warned.

On March 16, 2023, Cari­CRIS not­ed that if Ni­Quan was not able to achieve op­ti­mal pro­duc­tion by June 30, 2023, it would af­fect its abil­i­ty to re­fi­nance the ex­ist­ing notes or ob­tain ap­proval for a fur­ther ex­ten­sion by note­hold­ers by Ju­ly 31, 2023.

It not­ed that the in­abil­i­ty to achieve cer­ti­fi­ca­tion of the full name­plate ca­pac­i­ty of 2,400 bar­rels per day “ad­verse­ly im­pact­ed the Com­pa­ny’s abil­i­ty to se­cure time­ly re­fi­nanc­ing.”

At that time, it not­ed that in De­cem­ber 2022, Ni­Quan’s to­tal debt stood at US $218.7 mil­lion, a 416.6 per cent in­crease from 2018 and is pro­ject­ed to fur­ther in­crease to US $312 mil­lion as of De­cem­ber 2023.

The June 15 ac­ci­dent at the plant which even­tu­al­ly led to the death of 35-year-old pipe fit­ter Al­lan­lane Ramkissoon, and the sub­se­quent clo­sure of the plant for in­ves­ti­ga­tions by the Oc­cu­pa­tion­al Safe­ty and Health Agency and the Min­istry of En­er­gy and En­er­gy In­dus­tries (MEEI) af­fect­ed the com­pa­ny’s abil­i­ty to re-fi­nance its debt which was set for Ju­ly 31.

Gill fights back

How­ev­er, Ni­Quan founder and chief vi­sion­ary of­fi­cer Ains­ley Gill is fight­ing back claim­ing ir­reg­u­lar­i­ties in the ex­tra­or­di­nary res­o­lu­tions passed on No­vem­ber 7.

In a let­ter to RBL, Gill said that Ni­Quan was not in­clud­ed in the dis­cus­sions among note­hold­ers and was not al­lowed to state its case.

In his let­ter, he not­ed the Steer­ing Com­mit­tee’s plans to re-en­gage to get a nat­ur­al gas con­tract and to ne­go­ti­ate with Her­itage on its off-take prod­uct as er­ro­neous giv­en that note­hold­ers were not in­clud­ed in these con­tracts.

How­ev­er, the Sun­day Guardian un­der­stands that Ni­Quan’s agree­ment is with Paria.

Gill ar­gued that note­hold­ers did not have enough in­for­ma­tion to pass such a res­o­lu­tion and asked RBL to re­voke the No­vem­ber 7 res­o­lu­tion.

In ad­di­tion, he re­quest­ed the of­fi­cial vot­ing re­sults.

In lieu of that, the RBL called an­oth­er note­hold­er meet­ing and in­clud­ed Ni­Quan.

Since Oc­to­ber 18, fi­nanciers have been try­ing to change the com­pa­ny’s man­age­ment in a bid to save the plant and tried to re­move Gill from the helm of the project giv­en the ter­mi­na­tion of the nat­ur­al gas con­tract with the TTUDEO­CL which has ren­dered the plant pur­pose­less.

The Sun­day Guardian re­port­ed it was Gill’s de­ci­sion to seek an in­junc­tion against TTUDECOL for the sup­ply of nat­ur­al gas as op­posed to seek­ing out ar­bi­tra­tion which sig­nalled a break­ing point for the project.

How­ev­er, Gill is the largest share­hold­er of the com­pa­ny.

For­mer fi­nanciers, who have pumped hun­dreds of mil­lions in­to the project, be­lieve that Gill’s le­gal bat­tles with for­mer ex­ec­u­tives have cost the com­pa­ny from a rep­u­ta­tion­al per­spec­tive–for­mer in­de­pen­dent sen­a­tor David Small, a for­mer vice pres­i­dent for Ni­Quan En­er­gy was award­ed $20,647,017 mil­lion for breach of con­tract for monies owed to him dur­ing his em­ploy­ment. In 2021, Eber­hard Lucke, for­mer vice pres­i­dent of Process En­gi­neer­ing and Tech­nol­o­gy sued the com­pa­ny in the Har­ris Coun­ty court in Texas, for sums owed to him–US$368,793. On Jan­u­ary 6, 2022, he won his mat­ter and was award­ed US$435,000 by the court, but to date, Ni­Quan has on­ly paid 45 per cent of the sums owed to Lucke.

As it stands, the com­pa­ny’s le­gal chal­lenges come amid fi­nan­cial prob­lems plagu­ing the com­pa­ny–it’s close to US$300 mil­lion in debt–and has gone of­fline as a re­sult of no per­mis­sion to op­er­ate from the Min­istry of En­er­gy and En­er­gy In­dus­tries (MEEI) and no nat­ur­al gas con­tract in place.

Ni­Quan raised mon­ey on the in­ter­na­tion­al bond mar­ket, loans and sums from lo­cal in­vestors which in­clude Re­pub­lic Bank Ltd, RBC Trust (Trinidad and To­ba­go) Ltd, Bea­con In­sur­ance Com­pa­ny, First­line Se­cu­ri­ties, Prime Cap­i­tal Ltd, JMMB Se­cu­ri­ties Ltd, Wa­ter­loo Cap­i­tal Ad­vi­sors, KCL Cap­i­tal Mar­ket Bro­kers Ltd, In­shal­lah In­vest­ments, Farm Chem En­gi­neer­ing  Man­age­ment Ltd, GM Homes Ltd, M&J Ser­vices Ltd, Cen­tral Fi­nance Fa­cil­i­ty Co­op­er­a­tive So­ci­ety of Trinidad and To­ba­go Ltd, Petrotrin and Wash­ing­ton DC reg­is­tered, Ni­Quan En­er­gy LLC.

Ni­Quan has had five ex­ten­sions to re­pay its first bond as it met with chal­lenges try­ing to get the plant, which at one point was rel­e­gat­ed to scrap met­al, up and op­er­a­tional. Those chal­lenges were ex­ac­er­bat­ed by the COVID-19 pan­dem­ic.

Ni­Quan de­clined to com­ment to the Sun­day Guardian.

How­ev­er, the com­pa­ny has ap­pealed Jus­tice Kevin Ram­cha­ran’s Au­gust 21 de­ci­sion which de­nied Ni­Quan an in­junc­tion to com­pel the State to sup­ply nat­ur­al gas to the plant.

On Sep­tem­ber 22, Ni­Quan’s chair­man John An­drews, in a news­pa­per ad­ver­tise­ment, asked the Gov­ern­ment to up­hold the “sanc­ti­ty of con­tract” even though no con­tract ex­ists be­tween the com­pa­ny and the State.