JavaScript is disabled in your web browser or browser is too old to support JavaScript. Today almost all web pages contain JavaScript, a scripting programming language that runs on visitor's web browser. It makes web pages functional for specific purposes and if disabled for some reason, the content or the functionality of the web page can be limited or unavailable.

Tuesday, May 20, 2025

Solomon report didn’t recommend closure

by

Gail Alexander
2441 days ago
20180913
UNC Senator Gerald Ramdeen show members of the media the summary of S&A report during a press conference at the Office of the Opposition Leader on Charles Street, Port-of-Spain yesterday.

UNC Senator Gerald Ramdeen show members of the media the summary of S&A report during a press conference at the Office of the Opposition Leader on Charles Street, Port-of-Spain yesterday.

The ex­ec­u­tive sum­ma­ry of US con­sul­tants HSB Solomon and As­so­ciates, who ex­am­ined Petrotrin, didn’t state the re­fin­ery should be closed but rec­om­mend­ed or­gan­i­sa­tion­al build­ing blocks for Petrotrin to achieve its goal of be­com­ing a top-per­form­ing busi­ness.

The sum­ma­ry of S&A’s Feb­ru­ary 5, 2018 re­port to Gov­ern­ment on Petrotrin spoke of this and oth­er rec­om­men­da­tions to ad­dress work­force op­ti­mi­sa­tion.

Unit­ed Na­tion­al Con­gress Sen­a­tor Ger­ald Ramdeen pro­duced the 500-page re­port at a brief­ing yes­ter­day at the Op­po­si­tion’s Port-of-Spain of­fices.

“Noth­ing in the re­port says to close the re­fin­ery—the unions must know that. So the Prime Min­is­ter must now be man enough to call an elec­tion and see if he’ll win,” Ramdeen added.

Ramdeen pro­duced the re­port af­ter Gov­ern­ment de­clined—in Par­lia­ment on Tues­day—to say if re­ports which as­sist­ed in its de­ci­sion to close the re­fin­ery would be shared with the pub­lic.

En­er­gy Min­is­ter Franklin Khan, re­ply­ing to Op­po­si­tion ques­tions on what as­sist­ed them in mak­ing the de­ci­sion, par­tic­u­lar­ly cit­ed US con­sul­tants Solomon and As­so­ciates as a First in Class per­for­mance im­prove­ment ex­pert and McK­in­sey and Com­pa­ny Inc.

Yes­ter­day, Ramdeen dis­played S&A’s re­port, re­leas­ing the ex­ec­u­tive sum­ma­ry and in­tro­duc­tion to re­porters.

“This re­port be­longs to the peo­ple—it cost tax­pay­ers tens of mil­lions,” he said.

In Par­lia­ment in June, the En­er­gy Min­istry con­firmed HSB Solomon As­so­ciates was paid $7.4 mil­lion for com­pa­ny op­ti­mi­sa­tion work re­gard­ing Petrotrin. McK­in­sey and Com­pa­ny Inc was al­so paid $28 mil­lion for a strate­gic re­view and tran­si­tion.

S&A’s sum­ma­ry states Petrotrin re­tained the com­pa­ny for a work­force op­ti­mi­sa­tion ef­fort for its Ex­plo­ration/Pro­duc­tion and Down­stream/Mar­ket­ing or­gan­i­sa­tions at Pointe-a-Pierre, Point Fortin and San­ta Flo­ra, to de­ter­mine where op­por­tu­ni­ties ex­ist to op­ti­mise and en­hance ef­fi­cien­cy/work­force ef­fec­tive­ness.

S&A stat­ed that Petrotrin want­ed to know the rec­om­mend­ed man­pow­er util­i­sa­tion “based on peer group bench­marks and as­sess­ment of its ex­ist­ing or­gan­i­sa­tion­al struc­ture, staff lev­els and work process­es” in re­la­tion to top-per­form­ing fa­cil­i­ties of sim­i­lar size and com­plex­i­ty.

S&A was to as­sess the cur­rent work process­es/prac­tices as­so­ci­at­ed with dai­ly op­er­a­tions, main­te­nance and sup­port ac­tiv­i­ties as­so­ci­at­ed with E&P, as well as Re­fin­ing and Mar­ket­ing busi­ness­es.

The sum­ma­ry not­ed:

“The re­sult of Solomon’s as­sess­ment in­di­cat­ed that sev­er­al of the key lead­ers with­in Petrotrin are very knowl­edge­able, en­gaged and com­mit­ted to the suc­cess of the busi­ness.

Like­wise, Petrotrin man­age­ment has com­mu­ni­cat­ed a com­mit­ment to plac­ing the busi­ness on a path to sus­tain­able im­prove­ment and en­hanced per­for­mance.

“The prac­tices fol­lowed with­in the Petrotrin busi­ness sites were com­pared to Solomon’s in­dex of best prac­tices for work­force op­ti­mi­sa­tion. Over­all, Petrotrin is cur­rent­ly do­ing a num­ber of things well and em­ploys prac­tices in sev­er­al ar­eas that are con­sis­tent with the best oil and gas busi­ness­es in the world.

“How­ev­er, many prac­tices are lack­ing or are in­con­sis­tent­ly ap­plied in re­la­tion to those em­ployed by top-per­form­ing fa­cil­i­ties and present an op­por­tu­ni­ty for Petrotrin to sig­nif­i­cant­ly en­hance its ef­fi­cien­cy and ef­fec­tive­ness.”

S&A al­so stat­ed, “While many com­pa­nies at­tempt to op­ti­mise their work­forces sim­ply by re­duc­ing staffing lev­els or im­ple­ment­ing a new or­gan­i­sa­tion­al struc­ture, Solomon has ob­served over the years that the most prof­itable busi­ness­es are ac­tu­al­ly fo­cused on max­imis­ing or­gan­i­sa­tion­al ef­fec­tive­ness and fi­nan­cial per­for­mance, not just min­imis­ing the num­ber of peo­ple.”

S&A stat­ed that its pro­posed or­gan­i­sa­tion­al struc­ture and staffing tar­gets would equip Petrotrin with the nec­es­sary re­sources to “safe­ly, ef­fec­tive­ly and ef­fi­cient­ly op­er­ate and main­tain the busi­ness as well as cap­ture sig­nif­i­cant val­ue that’s cur­rent­ly be­ing lost.”

Ramdeen said S&A pre­sent­ed a plan to im­prove busi­ness on a phased ba­sis “but af­ter S&A’s pre­sen­ta­tion on the way for­ward, S&A was put to an end as Petrotrin’s board wasn’t in­ter­est­ed in car­ry­ing Petrotrin for­ward.”

Say­ing the Lash­ley re­port on Petrotrin didn’t rec­om­mend clo­sure ei­ther, Ramdeen added, “I chal­lenge Gov­ern­ment to pro­duce a re­port that sup­ports the de­ci­sion. This clo­sure is the biggest de­ceit, de­cep­tion and be­tray­al of the peo­ple.”

He ac­cused Gov­ern­ment of want­i­ng the as­sets for “hand­picked friends, fam­i­ly and fi­nanciers...al­ready de­ter­mined by Gov­ern­ment” and “the one per cent.”

He added, “Who are the peo­ple show­ing in­ter­est in Trin­mar, the re­fin­ery and Petrotrin?... those wait­ing in the wings … lo­cal and for­eign?”

Ramdeen cit­ed how Petrotrin’s de­te­ri­o­ra­tion - its US$750m bond, failed plants and oth­er is­sues - be­gan un­der the pre­vi­ous PNM of which Prime Min­is­ter Dr Kei­th Row­ley was a part.

“… And it’s now it’s said he has the mi­nus touch, not the Mi­das touch - his Gov­ern­ment on­ly takes and doesn’t give,” Ramdeen added.

S&A’s sum­ma­ry al­so not­ed:

•While Petrotrin has greater staffing lev­els than its key com­peti­tors, the busi­ness re­sults be­ing achieved are sig­nif­i­cant­ly less than top-per­form­ing Up­stream and Down­stream busi­ness­es in the key per­for­mance ar­eas of Op­er­a­tional Avail­abil­i­ty and Op­er­at­ing Costs.

• As such there ap­pears to be a sig­nif­i­cant op­por­tu­ni­ty to in­crease the ef­fi­cien­cy and ef­fec­tive­ness of the Petrotrin work­force in or­der to max­i­mize the fi­nan­cial per­for­mance of the busi­ness.

• While many com­pa­nies at­tempt to op­ti­mize their work­forces sim­ply by re­duc­ing staffing lev­els or im­ple­ment­ing a new or­ga­ni­za­tion­al struc­ture, Solomon has ob­served over the years that the most prof­itable busi­ness­es are ac­tu­al­ly fo­cused on max­imis­ing or­ga­ni­za­tion­al ef­fec­tive­ness and fi­nan­cial per­for­mance, not just min­i­miz­ing the num­ber of peo­ple,”

• Solomon’s ex­pe­ri­ence is that the busi­ness­es that have con­sis­tent­ly achieve top-quar­tile per­for­mance in terms of re­li­a­bil­i­ty, en­er­gy ef­fi­cien­cy, yield op­ti­mi­sa­tion and over­all prof­itabil­i­ty are not nec­es­sar­i­ly the busi­ness­es with the fewest per­son­nel.

•In fact, the best per­form­ers with­in the in­dus­try typ­i­cal­ly have per­son­nel re­sources rank­ing in the sec­ond quar­tile. At the same time the skills and ca­pac­i­ties of their work­forces, in con­junc­tion with the ef­fi­cien­cy and ef­fec­tive­ness of their work process­es, en­able them to con­sis­tent­ly achieve an in­creased lev­el of per­for­mance ver­sus their com­pe­ti­tion,”

• Key fac­tors to be con­sid­ered and be present in a busi­ness or­gan­i­sa­tion for sus­tain­able op­ti­miza­tion of the work­force are:

Ef­fi­cient work process­es.

Clar­i­ty of roles/re­spon­si­bil­i­ties.

Fo­cused aligned or­ga­ni­za­tion­al struc­ture.

High lev­els of skills, com­pe­ten­cy.

Util­i­sa­tion of tech­nol­o­gy and au­toma­tion to help max­i­mize pro­duc­tiv­i­ty.

• Sug­gest­ing Petrotrin es­tab­lish a con­tin­u­ous im­prove­ment cul­ture, S&A stat­ed: “Con­tin­u­ous change isn’t just a project, it’s a re­lent­less, nev­er-end­ing process as well as cul­ture change.”

• The sum­ma­ry al­lud­ed to “trans­for­ma­tion­al change which could on­ly be achieved by Petrotrin man­age­ment, union lead­er­ship and the Share­hold­er all work­ing to­geth­er in con­cert” to im­ple­ment nec­es­sary changes that will pro­vide the com­pa­ny with “foun­da­tion­al el­e­ments” for it to in­crease ef­fi­cien­cy, ef­fec­tive­ness and fi­nan­cial suc­cess for many years to come.”


Related articles

Sponsored

Weather

PORT OF SPAIN WEATHER

Sponsored