A REQUEST by Patriotic Energies and Technologies for more information on the Pointe-a-Pierre refinery has caused a delay in the negotiations between the company and the Government for the sale of the Guaracara Refinery Company.
This was disclosed by Prime Minister Dr Keith Rowley when he provided an update in response to a question from Couva South MP Rudy Indarsingh in the House of Representatives yesterday.
The prime minister said before the bidding began, a data room where interested parties could come and see information related to the operations of the refinery had been created.
He said Patriotic, which is owned by the Oilfields’ Workers Trade Union (OWTU), has now indicated that it would like to see the actual refinery in greater detail.
As a result of this request, several subject matter experts—“that is, persons who are intimately familiar with the refinery as a physical entity”—are now preparing the additional information that Patriotic asked for.
He said based on the outcome of these negotiations a decision would be taken on the final buyer for the refinery.
“We hope to do so by the end of March,” the prime minister said.
Asked by Indarsingh if he was sure Patriotic was in a position to finance the purchase of the refinery, Rowley said he knew of “no withdrawal of enthusiasm” and that the process was on the way.
The prime minister acknowledged there was an “element of delay”, but he said the Government could not go at a faster pace than what Patriotic wanted and therefore if Patriotic had asked for additional information, that had to be part of the process.
PM: Back to square one if Patriotic loses interest
Pointe-a-Pierre MP David Lee asked what the situation would be if Patriotic, after it conducts its evaluation of the refinery, decided to withdraw its bid.
The prime minister said: “We go back to square one... The process generated Patriotic and we are working with them toward a point where if they complete their interest in the matter, then we have a re-start (of the refinery) at some time. What is happening now is that we are moving from the data room evaluation to looking at the actual refinery itself.
“This expert group is going to go through the refinery to ensure that (Patriotic) is clear on what the re-start would require and the investment in the re-start. If along the way Patriotic decides it is too much for them or they are no longer interested, well then we back to square one—we don’t have an interested party. And we will have a refinery which would be number 18 in the world which would not be operating.”
Is it that the Government does not know if, where and how much the preferred bidder can raise, and the preferred bidder now needs a tour of the installation to better position its bid?—Oropouche East MP Roodal Moonilal asked, before remarking: “What kind of Mickey Mouse business has been taking place on this matter?”
The PM countered: “Madam Speaker, that is not a question requiring an answer. That is an opinion and I am not prepared to comment on the opinion of an under-miner.”
“You playing the fool,” Moonilal rejoined. This caused the Speaker to rise and reprimand him for his “inappropriate language”, which she requested that he withdraw.
He did so.
Naparima MP Rodney Charles asked whether, on reflection, it was a mistake to close the refinery, given the problems the Government was encountering and the cost involved in re-starting the refinery.
The question was disallowed by the Speaker, to the apparent disappointment of the prime minister, who appeared to have a fiery response ready. He muttered to Charles: “Yuh lucky!”
On September 20, 2019, almost one year after the November 30, 2018 closure of the Petrotrin refinery, Finance Minister Colm Imbert announced in Parliament that Patriotic Energies and Technologies—a company owned by the OWTU—was the preferred bidder to own and operate the Pointe-a-Pierre refinery after it won the bid to purchase the Guaracara Refinery Company and Paria Fuel Trading Company Ltd with a US$700 million offer.
In its proposal, Patriotic had offered upfront cash consideration of US$700 million plus US$300 million for the non-core assets of the company, including the Augustus Long Hospital.
However, the non-core assets were not offered for sale by the Government.
The company was granted a three-year moratorium on all payments of principal and interest, towards the purchase of the refinery and a further ten years, at a fair market interest rate, to complete the payment of the sum of U$700 million it offered for the refinery.
The prime minister stated then that the OWTU proposal was the best proposal which came out of a “very transparent, deliberate and extended process”.
Imbert, in a subsequent interview, said the company would be able to re-start the refinery in less than 12 months since it would not immediately have to raise its US$700 million payment.
In November 2019 the prime minister, speaking during a public meeting in the local government election campaign, said the Government would do everything reasonable to help the OWTU to acquire the refinery.
“In these battles for nationalism and the fight for survival and sustainability, we are all in this together,” he said. “We could visualise the OWTU leadership moving from pounding the pavements and shouting across the street, to being in the boardroom and taking serious decision about serious investments that could make their members seriously rich,” the prime minister had said.
In his final campaign address delivered at the PNM election convention, the prime minister said Patriotic Energies and Technologies was to “reignite the flames at Guaracara” and would serve as a beacon of what was possible for every citizen.