Aleem Khan

Al­most four years af­ter state-owned Petrotrin ap­point­ed Price­wa­ter­house Coop­ers (PwC) "the re­ceiv­er" in the failed gas-to-liq­uids (GTL) plant ven­ture, PwC has been or­dered by a Port-of-Spain High Court to re­frain from seek­ing out any of­fers for the sale of the plant, ac­cord­ing to court doc­u­ments stamped Ju­ly 4.

The re­ceiv­er's main func­tion was to liq­ui­date the avail­able as­sets from the failed com­pa­ny to pay back the cred­i­tor, the state. At­tor­ney Gen­er­al Anand Ram­lo­gan said in Par­lia­ment on May 14 that "the loss sus­tained and suf­fered by the peo­ple of this coun­try (the sum pumped in­to World GTL Trinidad Ltd) is over $1.2 bil­lion."

The un­der­tak­ing came af­ter Ni­Quan En­er­gy Trinidad Ltd filed an ap­pli­ca­tion for an in­junc­tion against PwC al­leg­ing that the re­ceiv­er, PwC Part­ner Bri­an Hack­ett, lacked "good faith," en­gaged Chi­nese in­vestors, and breached the terms of an ex­clu­siv­i­ty agree­ment signed with Ni­Quan, af­ter the lat­ter surged as "the on­ly op­tion on the ta­ble," at a time when the plant was be­lieved to be on­ly good as "scrap iron."

Re­fer­ring to the WGTL-Trinidad Ltd (WGTL-TL) plant, Ram­lo­gan al­so said in Par­lia­ment: "That plant, as you know, af­ter over $1 bil­lion was pumped in­to it, is now be­ing sold as scrap iron and even to find a buy­er for the scrap iron has proven to be a chal­lenge, and over $1 bil­lion was wast­ed in it."

In the un­der­tak­ing, Jus­tice Mi­ra Dean-Ar­mor­er or­dered that Petrotrin re­frain from "in­ter­fer­ing with and/or di­rect­ing" WGTL-TL and PwC "in their eval­u­a­tion and/or ne­go­ti­a­tion" of Ni­Quan En­er­gy's pro­pos­al to com­plete and bring the WGTL-TL plant in­to op­er­a­tion. Ni­Quan had sub­mit­ted a pro­pos­al on Jan­u­ary 30, (2013) as part of a 120-day ex­clu­siv­i­ty agree­ment en­tered in­to with WGTL-TL and PwC on Oc­to­ber 2, 2012. The agree­ment gave Ni­Quan "the ex­clu­sive right to ac­quire or oth­er­wise in­vest in the as­sets" of WGTL-TL cap­tured un­der the terms of the deben­ture un­der which PwC was charged with the re­spon­si­bil­i­ty to sell.

By terms of the ex­clu­siv­i­ty agree­ment, the par­ties were man­dat­ed to act in good faith in their deal­ings with each oth­er; Ni­Quan was re­quired to meet cer­tain mile­stones dur­ing the ex­clu­siv­i­ty pe­ri­od, one of which was the sub­mis­sion of its of­fer; and WGTL-TL and PwC were there­after re­quired to ne­go­ti­ate and com­plete ne­go­ti­a­tions in re­spect of Ni­Quan's of­fer.

In its ap­pli­ca­tion for the in­junc­tion, filed June 28 (2013), Ni­Quan said: "Notwith­stand­ing the terms of the ex­clu­siv­i­ty agree­ment, the de­fen­dants (PwC) arranged and/or per­mit­ted rep­re­sen­ta­tives of a prospec­tive pur­chas­er/in­vestor to vis­it the GTL plant in or around De­cem­ber 2012, that is to say, dur­ing the ex­clu­siv­i­ty pe­ri­od. This vis­it took place with­out the pri­or knowl­edge and/or con­sent of (Ni­Quan) and in breach of the terms of the ex­clu­siv­i­ty agree­ment."

Hav­ing re­gard to Ni­Quan's com­pli­ance with its oblig­a­tions un­der the ex­clu­siv­i­ty agree­ment by the com­ple­tion of the mile­stones and its sub­mis­sion of its of­fer dat­ed Jan­u­ary 30 (2013), the par­ties en­tered in­to an ex­clu­siv­i­ty amend­ment agree­ment dat­ed Jan­u­ary 31 (2013), the no­tice of ap­pli­ca­tion for an in­junc­tion said.

By terms of the ex­clu­siv­i­ty amend­ment agree­ment, WGTL-TL was re­quired to de­ter­mine in its ex­clu­sive dis­cre­tion whether Ni­Quan's of­fer was sat­is­fac­to­ry for the pur­pos­es of fur­ther ne­go­ti­a­tions, the court doc­u­ments said. The ex­clu­siv­i­ty pe­ri­od was ex­tend­ed in the first in­stance to Feb­ru­ary 22 (2013) to al­low for the eval­u­a­tion of the com­mer­cial pro­pos­al; and the ex­clu­siv­i­ty pe­ri­od would be ex­tend­ed to June 30, in the sec­ond in­stance, should WGTL-TL find the pro­pos­al ac­cept­able, the ap­pli­ca­tion said.

Ni­Quan said in its ap­pli­ca­tion that the Feb­ru­ary 22 dead­line for the eval­u­a­tion of Ni­Quan's of­fer–mean­ing whether WGTL-TL found it sat­is­fac­to­ry and/or ac­cept­able for the pur­pose of fur­ther ne­go­ti­a­tions–was not met. At the re­quest of WGTL-TL and PwC, Ni­Quan said it en­gaged in fur­ther dis­cus­sions with, and sup­plied clar­i­fi­ca­tion to, WGTL-TL and PwC dur­ing Feb­ru­ary and March (2013) for the pur­pose of their eval­u­a­tion in due course.

Ni­Quan said in its ap­pli­ca­tion that Petrotrin rep­re­sent­ed that "its of­fer was ac­cept­able." Ni­Quan said that con­trary to the rep­re­sen­ta­tions of Petrotrin, WGTL-TL and PwC ad­vised Ni­Quan on April 16 (2013) that Petrotrin did not find its of­fer to be sat­is­fac­to­ry, that the ex­clu­siv­i­ty agree­ment was now at an end, and that they would now ap­proach oth­er en­ti­ties. WGTL-TL and PwC al­so in­vit­ed Ni­Quan to sub­mit a re­vised pro­pos­al, the ap­pli­ca­tion doc­u­ment said.

Notwith­stand­ing the con­tents of their let­ter dat­ed April 16, WGTL-TL and PwC con­tin­ued to meet and have dis­cus­sions with Ni­Quan in re­spect of its of­fer dat­ed Jan­u­ary 30, and re­quest­ed and re­ceived doc­u­ments from Ni­Quan to sup­port its of­fer.

In the ap­pli­ca­tion to the court, Ni­Quan said that "at all ma­te­r­i­al times," WGTL-TL and PwC led Ni­Quan to be­lieve that the sup­port­ing doc­u­ments were to make an eval­u­a­tion as to whether Ni­Quan's of­fer was sat­is­fac­to­ry for fur­ther ne­go­ti­a­tions and ac­cep­tance. Ni­Quan said they rep­re­sent­ed that its of­fer was be­ing con­sid­ered favourably and that an agree­ment was im­mi­nent.

Ex­pres­sions of in­ter­est

In­stead Ni­Quan said "in the month of June (2013), the de­fen­dants (WGTL-TL and PwC) per­mit­ted and have been per­mit­ting prospec­tive pur­chasers/in­vestors to vis­it the GTL plant and, have been invit­ing and/or con­sid­er­ing ex­pres­sions of in­ter­est and/or pro­pos­als in re­spect of the sale of the charged as­sets (WGTL-TL as­sets), con­trary to the terms of the ex­clu­siv­i­ty pe­ri­od and the in­ten­tion of the par­ties."

Ni­Quan said its at­tor­neys have sought from WGTL-TL and PwC con­fir­ma­tion of the iden­ti­ty of the prospec­tive pur­chas­er as well as an un­der­tak­ing from them that they would deal with Ni­Quan ex­clu­sive­ly and abide by the terms of the ex­clu­siv­i­ty agree­ment.

Ni­Quan said, PwC's Hack­ett has not made him­self avail­able to Ni­Quan's at­tor­neys and no in­for­ma­tion has been forth­com­ing from WGTL-TL or PwC.

In­stead, Ni­Quan said in the ap­pli­ca­tion to the court: "It has re­cent­ly come to the at­ten­tion of the claimant (Ni­Quan), most re­cent­ly on June 27 (2013), that the de­fen­dants (WGTL-TL and PwC) are dis­pos­ing of cer­tain pieces of equip­ment and prop­er­ty which form part of the charged as­sets and/or pro­vid­ing third par­ties with cat­a­lyst sam­ples and/or per­mit­ting third par­ties to view and/or take away and/or to pur­chase parts of the charged as­sets in breach of the ex­clu­siv­i­ty agree­ment as amend­ed."

Ni­Quan said it "fears that by hav­ing pro­vid­ed third par­ties with and per­mit­ting said third par­ties to take away cat­a­lyst sam­ples, the de­fen­dants have ei­ther de­lib­er­ate­ly and/or un­wit­ting­ly pro­vid­ed said third par­ties with the op­por­tu­ni­ty to analyse and de­con­struct the cat­a­lyst (which is the core of the GTL plant/tech­nol­o­gy) for the pur­pos­es of en­gag­ing in re­verse en­gi­neer­ing to de­sign and con­struct a sim­i­lar and/or iden­ti­cal projects which is the sub­ject of the claimant's of­fer."

Ni­Quan de­scribed the hand­ing over of cat­a­lyst sam­ples to third par­ties as "a loss of in­tel­lec­tu­al cap­i­tal and pro­pri­etary in­for­ma­tion."

In its claim form sub­mit­ted to the court, apart from "an or­der for spe­cif­ic per­for­mance of the ex­clu­siv­i­ty agree­ment," Ni­Quan claims "dam­ages for breach of con­tract" plus an in­junc­tion re­strain­ing WGTL-TL and PwC from seek­ing out any of­fers for the as­sets. From Petrotrin, Ni­Quan is claim­ing for "dam­ages for in­duc­ing WGTL-TL and PwC to breach the terms of the ex­clu­siv­i­ty agree­ment."

Up­on read­ing Ni­Quan's ap­pli­ca­tion and up­on hear­ing the at­tor­neys for Ni­Quan, WGTL-TL and PwC, Jus­tice Dean-Ar­mor­er or­dered in an un­der­tak­ing stamped Ju­ly 4, that WGTL-TL and PwC, "pend­ing the hear­ing and de­ter­mi­na­tion of this in­ter­im in­junc­tion ap­pli­ca­tion" re­frain from "so­lic­it­ing, en­gag­ing en­cour­ag­ing or seek­ing out any of­fers or oth­er pro­pos­al for the sale and pur­chase of the charged as­sets as de­fined un­der the ex­clu­siv­i­ty agree­ment dat­ed Oc­to­ber 2, 2012."

She al­so pro­hib­it­ed them from al­low­ing any prospec­tive buy­er to view or have ac­cess to, or give in­for­ma­tion on the charged as­sets to any prospec­tive buy­er.

The ap­pli­ca­tion was sub­mit­ted with af­fi­davits in­clud­ing one from In­shan Suli­man, the as­set preser­va­tion con­trol valve lead em­ployed with WGTL-TL. In his af­fi­davit, Suli­man said he ob­served two men of Chi­nese ori­gin in the con­trol room of the plant in De­cem­ber 2012. He said they were look­ing around and speak­ing with two of his col­leagues, Karam­chan Ram­sumair and Lin­coln Har­ri­son. He said they ap­peared to be re­ceiv­ing a tour.

He said that lat­er in March, he was asked to put a pack­age to­geth­er with all the rel­e­vant plant in­for­ma­tion for po­ten­tial in­vestors. He said that al­so in March, he at­tend­ed a WGTL-TL team meet­ing where Kevin Ol­livier­ra of the Ma­te­ri­als De­part­ment told the team "fund­ing was low and that we need­ed to look at items which we could sell to bring in­come from the sale of these items. I was asked to list the items and send an e-mail to Bri­an Hack­ett of PwC the re­ceiv­er."

In an­oth­er af­fi­davit sub­mit­ted to the court, Lin­coln Har­ri­son, then an em­ploy­ee of WGTL-TL said Kevin Maraj of PwC called him and told him there would be a vis­it to the site by some Chi­nese gen­tle­men who were com­ing in to see the plant, ac­com­pa­nied by Petrotrin em­ploy­ees Im­ti­az Ali and Hem­raj Ram­dath.

Har­ri­son said ap­prox­i­mate­ly two hours af­ter the call from Maraj, Ol­livier­ra led him to his (Ol­livier­ra's) pri­vate ve­hi­cle in which there were two Chi­nese gen­tle­men. Ol­livier­ra "then pro­ceed­ed to do a dri­ve through tour of the plant and the Chi­nese gen­tle­men be­gan to take pho­tographs with their cam­era phones in my pres­ence," Har­ri­son said.

He said: "Af­ter the tour of the con­trol build­ing, the Chi­nese gen­tle­men left the site with Ol­livier­ra in his pri­vate ve­hi­cle."

Asked for a re­sponse to the in­junc­tion, through a PwC spokesper­son, Hack­ett said in an e-mail: "There (is) no in­junc­tion in place. Le­gal sub­mis­sions have to be filed and the mat­ter will re­sume in Sep­tem­ber 2013. The mat­ter is now be­fore the court and as such the re­ceiv­er will not be mak­ing any fur­ther pub­lic state­ments un­til the res­o­lu­tion of same by the Court."

WGTL-TL's par­ent com­pa­ny is New York-head­quar­tered World GTL Inc, which At­tor­ney Gen­er­al Anand Ram­lo­gan de­scribed as "a shell com­pa­ny with no as­sets." Ni­Quan En­er­gy Trinidad Ltd's par­ent com­pa­ny is Wash­ing­ton-head­quar­tered Ni­Quan En­er­gy LLC.

NiQu­uan's chair­man is John An­drews, a for­mer At­lantic head and a for­mer per­ma­nent sec­re­tary.

Lon­don-head­quar­tered PwC is con­sid­ered one of the top four ac­count­ing firms in­ter­na­tion­al­ly.

World GTL Trinidad Ltd (WGTL-TL) was orig­i­nal­ly con­ceived as a joint ven­ture be­tween World GTL Inc and the Pe­tro­le­um Com­pa­ny of T&T Ltd (Petrotrin) in which each par­ty would hold 51 per cent and 49 per cent eq­ui­ty stakes, re­spec­tive­ly.

WGTL-TL was to own and op­er­ate the 2,250 bar­rel-per-day gas-to-liq­uids (GTL) plant, lo­cat­ed at the Petrotrin Pointe-a-Pierre re­fin­ery. Petrotrin was to sup­ply the feed­stock nat­ur­al gas and be the sole pur­chas­er of the diesel prod­uct that would come out of the plant.

The GTL plant promised to be the first com­mer­cial one in the West­ern Hemi­sphere. The GTL diesel was to be of high qual­i­ty and more en­vi­ron­ment-friend­ly.

Petrotrin was to use the GTL diesel as a blend­stock com­po­nent for its diesel out­put. In ad­di­tion, the plant was sup­posed to pro­duce hy­dro­gen as a by-prod­uct, which would have been made avail­able for pur­chase by Petrotrin.

The project com­menced in Feb­ru­ary 2006 when dis­man­tling of ac­quired equip­ment be­gan. Con­struc­tion at the Pointe-a-Pierre site com­menced in No­vem­ber 2006. As at Au­gust 2009, the es­ti­mat­ed over­all plant con­struc­tion to me­chan­i­cal com­ple­tion was es­ti­mat­ed at 97 per cent. When PwC was named the re­ceiv­er, WGTL-TL was de­clared "in re­ceiver­ship."

First diesel was es­ti­mat­ed for end March 2010. The to­tal project bud­get was es­ti­mat­ed at US$428 mil­lion ($2.7 bil­lion).