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Extractive Sector
Can we afford Petrotrin?

Can we afford Petrotrin?

Date: September 17th , 2017

Dear Editor/Newsroom,
Caroni 1975 Ltd. was paying for sugar cane, it never received. How much did Caroni contribute to the country’s GDP and did it ever lose more than 300M TTD in its worst year? Caroni like many other failed state enterprises were forced to be shut down rather than risk economic collapse. Caribbean Airlines foolishly bailed out Air Jamaica and inherited their failures which combined with ours, caused our citizens to be plunged further into debt. Why should we the citizens in 2017 be indebted with 44 Billion in outstanding unpaid loans from State Enterprises? (April 25th online Guardian, “State Enterprises owe Government 44B”). Were these loans wisely invested?

State owned Petrotrin is an ongoing national disaster which according to our own Prime Minister “could bankrupt this country if there is an oil spill in the Gulf of Paria”, and there are many unreported spills in the Gulf. Today, we learn of another internal fraud in the buying of Petrotrin’s petroleum products which may, if thoroughly investigated, amount to hundreds of millions, maybe billions, lost to the deep pockets of friends of the political elite. Is the alleged 100 Million “Haniff Nazim Baksh of AV Oil and Gas Drilling fake oil” fiasco just the tip of Petrotrin’s corruption iceberg? Corruption scandals and gross mismanagement have plagued this facility almost from inception. Except for the unusual boom years of 2011 to 2012 (when oil was 100+ USD per barrel), Petrotrin, our most valuable state owned enterprise with the most economic potential is haemorrhaging our economy. Now we know why!

Who paid Petrotrin’s 4.5 Billion TTD loss in 2016? Will our Prime Minister have the courage to face this propped up yet dying monster? Petrotrin has over 5000 employees, with an annual wage bill of 1.9 Billion, which is 50% of its total annual operating costs. Is this sustainable?

Now that we know there is fraud in the receipt of oil, so certainly there would more than likely be similar scams in the delivery and sale of Petrotrin’s products to local gas stations and export customers as well. Who is checking the record of oil and gas deliveries and receipts to each of Petrotrin’s local and foreign customers and suppliers, contractors and farm out operators? What prices do Petrotrin currently pay for each and all of its goods and services and how do those prices compare to the rates paid by the private sector for the same of comparative goods and services? One clear loophole that management at the highest level has ensured is that Petrotrin still uses handheld dip sticks to measure deliveries and receipts instead of mechanical fool proof technically competent digital gauges that keep precise records of measurement of volume in an unalterable way. Human error in the dip stick measurement of what is received or delivered arguably cannot be held to be culpable simply because the crude archaic tool is susceptible to error … and they know it. Is that an accident or an alibi?

We are being forced to finance this failing state enterprise who have no shame in posting a 4.5 Billion TTD loss for one year, which omits to measure the billions in annual revenues and earnings that have been pillaged. Could Petrotrin raise funding to finance its operations if our people, our Government, our treasury did not stand guarantee? And what exactly is the total value of Petrotrin’s independent loans? What about its 1.2 Billion TTD debt to the treasury in unpaid taxes? Who will cover the “back-pay” liability of over 600 Million TTD owed to the hard-core Oilfield Workers Trade Union (OWTU) as of December 2016? Petrotrin is now plagued with 13.2 Billion debt with high debt service charges, and it would appear those loans and operational upgrades have, you guess…… failed. After all of these proven failures why is no one questioning Petrotrin existence while everyone condemned and called for the closure of CARONI 1975 LTD but are instead debating at this time of global energy collapse, another 15 Billion bailout to upgrade this failed and overstaffed oil refinery?

The new Board would be well advised to appoint several independent forensic auditors to investigate all deliveries, inventories and sales, or any procurement whatsoever while at the same time examining the frightfully under-priced royalty values which Trinidad and Tobago currently obtains from our extractive marine territory.

Petrotrin’s annual losses surpass the total annual import bill of Massey Stores (234MTTD) and PriceSmart (534MUSD) combined. Just imagine, if the Petrotrin noose is released every single citizen could be given 4000 TTD.

As we face major global energy supply adjustments in an ever changing and more competitive world environment can we afford to risk national welfare for the sake of one more blatantly corrupt mismanaged and vandalized state enterprise?

Gary Aboud
Corporate Secretary

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