It is elec­tion time again. It is a time of­ten re­ferred to as the sil­ly sea­son when politi­cians make all kinds of claims and promis­es in an ef­fort to con­vince the elec­torate to vote for them.

This pat­tern of be­hav­iour is not unique to T&T and both ma­jor po­lit­i­cal par­ties are guilty of it. What I think the coun­try should how­ev­er re­ject are promis­es that are in­im­i­cal to T&T’s in­ter­est. One such ex­am­ple is the UNC’s talk about the restart of the Point-a-Pierre re­fin­ery by the State, with or with­out pri­vate sec­tor in­volve­ment.

I am on record in my sup­port for the clo­sure of the re­fin­ery, not be­cause I want­ed to see thou­sands of work­ers lose their jobs but be­cause the coun­try could not af­ford to con­tin­ue to sup­port op­er­a­tions that were bleed­ing the trea­sury, with lit­tle hope of a turn­around.

The de­ci­sion to shut down the re­fin­ery was bold, risky and po­ten­tial­ly po­lit­i­cal sui­cide but to the cred­it of the present ad­min­is­tra­tion they had the for­ti­tude to do it.

As with most things in this gov­ern­ment, the com­mu­ni­ca­tion sur­round­ing its clo­sure was a botched job but it does not take away from the fact that the re­fin­ery could not, and was not mak­ing a prof­it.

In case we for­get, by the time the re­fin­ery was shut down and thou­sands of work­ers sent home, Petrotrin had chalked up bil­lions of dol­lars in debt, it had a US$850 mil­lion bond pay­ment due, which it could not meet and was los­ing be­tween US$1.50 and US$3.00 per bar­rel of oil.

The glob­al re­fin­ing busi­ness is all about mar­gins, that is to say you pur­chase crude oil for the re­fin­ery, you process it in­to dif­fer­ent fu­els, like avi­a­tion fu­el, gaso­line and diesel and even fu­el oil and then sell those prod­ucts at a prof­it.

For you to be prof­itable it re­quires the abil­i­ty to source crude at glob­al prices and process that fu­el so ef­fi­cient­ly that you can make a prof­it on each bar­rel of prod­uct and then mar­ket that prod­uct.

It of­ten re­quires a high­ly mech­a­nised and ef­fi­cient re­fin­ery, sig­nif­i­cant cost con­trol sys­tems, economies of scale, con­trol on the pro­vi­sion of the crude and the mar­ket­ing, in­clu­sive of the down­stream mar­kets.

Most suc­cess­ful re­finer­ies are op­er­at­ed by large oil pro­duc­ers who use their crude and re­fine it, they con­trol the ships, they con­trol the crude, they have lean and ef­fi­cient re­finer­ies and al­so con­trol the re­tail sale of the prod­uct by hav­ing fu­el sta­tions. These con­di­tions do not, and are un­like­ly to ex­ist any-time soon at the Pointe-a-Pierre Re­fin­ery.

Even if one as­sumes that the re­fin­ery is free of all en­cum­brances it does not change the fact that in-spite of many up­grades, when bench­marked against best in class re­finer­ies, the Pointe-a-Pierre re­fin­ery con­sis­tent­ly failed to match up to best in class.

But in think­ing about writ­ing this ar­ti­cle I want­ed to make sure that I ful­ly un­der­stood the UNC’s plan be­hind the restart. So I reached out to its can­di­date for Pointe-a-Pierre David Lee, who in the last Par­lia­ment act­ed as the op­po­si­tion’s shad­ow En­er­gy Min­is­ter.

I asked Mr Lee what was the UNC’s plan in restart­ing the re­fin­ery. His re­sponse was “Ent Pa­tri­ot­ic was go­ing to restart it?”

I asked him to con­firm if this restart as ar­tic­u­lat­ed by the UNC would have state in­volve­ment or if it would sup­port pri­vate sec­tor con­trol of the re­fin­ery. He said it would be with­out the pri­vate sec­tor.

I asked him if he was aware that most ex­perts say the cost of just restart­ing the re­fin­ery would run be­tween $300 mil­lion and $750 mil­lion for which his re­sponse was; “What­ev­er it takes, we would restart the re­fin­ery.”

I put it to him that you would then im­me­di­ate­ly have to fork out hun­dreds of mil­lions of tax­pay­ers dol­lars on a re­fin­ery which we don’t even know the con­di­tion of.

Lee said: “Well, first of all, the first thing we would have to do is re­assess what is the sta­tus of the re­fin­ery, be­cause the re­fin­ery has been down for over two years. So that we have to, as every­thing else in busi­ness, we have to as­sess and then make it work so, we are pre­pared to restart the re­fin­ery and it’s go­ing to hap­pen un­der the Unit­ed Na­tion­al Con­gress. That’s as much as I would like to say at this point in time.”

I told him the coun­try need­ed to have some de­tail about such a ma­jor de­ci­sion but he said; “I wouldn’t be in a po­si­tion right now to go in­depth with what we have.”

Lee then asked to speak with me fur­ther on Tues­day morn­ing.

I called him on four oc­ca­sions on Tues­day morn­ing in­clud­ing im­me­di­ate­ly af­ter he had con­clud­ed an in­ter­view on TV. He nei­ther took the call nor re­turned it at time of writ­ing.

It sounds good to promise peo­ple to restart the re­fin­ery and make them feel thou­sands of jobs will re­turn, es­pe­cial­ly if it is your con­stituen­cy and you are in a bat­tle be­cause it is a mar­gin­al seat, but in an ef­fort to win an elec­tion wild and dan­ger­ous promis­es must be called out, less we vote in favour of them and then find our­selves sad­dled with more loss­es.

The coun­try made a painful de­ci­sion to shut down the re­fin­ery. In some ways it was a na­tion­al hu­mil­i­a­tion be­cause we took over it from Tex­a­co and af­ter decades we were in­ca­pable to make it a prof­itable ven­ture.

At the time the re­fin­ery was pur­chased by the then George Cham­bers gov­ern­ment it was an at­tempt to save jobs and eco­nom­ic ac­tiv­i­ty in the area. It was about pleas­ing the unions and na­tion­al­is­tic fer­vour. And what has it brought us?

As a coun­try, we need less gov­ern­ment in busi­ness and while I would love the re­fin­ery to be restart­ed it must be by any­one but the gov­ern­ment.

The UNC does not have a good record in man­ag­ing state-owned en­er­gy com­pa­nies and in its last tenure al­most brought the Na­tion­al Gas Com­pa­ny (NGC) to its knees, us­ing it as a po­lit­i­cal foot­ball, mak­ing it build play­grounds in UNC con­trolled con­stituen­cies, spend­ing a bil­lion dol­lars on a failed waste-wa­ter treat­ment plant and raid­ing it of bil­lions of dol­lars for bud­getary sup­port; even when oil and gas prices were at record lev­els.

The par­ty promised to in­crease crude oil pro­duc­tion us­ing Petrotrin, in­stead it saw a 30 per cent drop in oil pro­duc­tion, the largest fall in the coun­try’s his­to­ry.

It told us that the coun­try would be right with the ju­bilee dis­cov­ery that proved to be noth­ing but show-boat­ing.

For those who talk about fu­el se­cu­ri­ty, I ask if the 95 per cent of the coun­tries in the world that do not have re­finer­ies are es­pe­cial­ly vul­ner­a­ble and don’t have fu­el se­cu­ri­ty?

The ques­tion David Lee and the UNC must an­swer are.

1. Would the restart of the re­fin­ery mean the crude now ex­port­ed will have to be used in the re­fin­ery?

2. If so, where is the mon­ey go­ing to come from to pay the in­ter­est on the bond?

3. Will we still have to im­port 80,000 bar­rels of oil per day?

4. Where are the hun­dreds of mil­lions need­ed to restart the re­fin­ery go­ing to come from?

5. What will that mean for the cash flow of Her­itage?

Maybe Mr Lee will an­swer some of these ques­tions in de­tail. If not this is noth­ing but play­ing smart with fool­ish­ness.