The Trinidad and Tobago government Monday reiterated its position that it was necessary to close down the refinery of the state-owned oil company, PETROTRIN, insisting that the company was losing billions of dollars annually.
Finance Minister Colm Imbert, delivering the TT$51.7 billion budget to Parliament, said that the government had agreed that following a “comprehensive assessment and analytical review of its operations” to shut down the refining and marketing business unit of PETROTRIN)
Imbert said that all the major plant upgrades failed – from the gas optimization plant to the ultra-low sulfur diesel complex and the gas-to-liquids plant – all experiencing substantial cost overruns in the process. The cost of these upgrades has loaded the company with an unsustainable debt burden estimated at TT$12 billion of which TT$5.780 billion is due in August 2019.
He said over the years, the survival of the company was only possible through the non-payment of TT$3.5 billion in taxes and royalties, in breach of the law, and the procuring of government guarantees in the amount of TT$1.5 billion for loans from financial institutions which have significantly increased the public debt.
“This has placed a severe burden on the Treasury and on taxpayers, especially in view of the fact that PETROTRIN extracts 40,000 barrels per day of taxpayers’ oil, at a value of six billion dollars per year, for which taxpayers receive no benefit.”
Imbert said that despite the fact that PETROTRIN is tottering on the brink, as recently as last month, PETROTRIN approached the Ministry of Finance for financial support by way of another government guarantee in the amount of US$56 million to purchase a cargo of crude oil, since the shipper refused to discharge the cargo without a guaranteed letter of credit.
He said the latest financials for the company are illustrative of a looming crisis which if left unresolved would have a serious impact on the national economy.
