Three weeks before Prime Minister (PM) Dr Keith Rowley announced that Trinidad and Tobago (TT) has to “find new ways to diversify (and) expand our earning potential”, the State-owned Petroleum Company of Trinidad and Tobago Limited (Petrotrin) held talks with a Ghanaian company about doing exactly that.
On August 23, 2016, Petrotrin’s President, Fitzroy Harewood, met with Chairman of Ghana’s Bulk Oil Storage and Transportation Company Limited (BOST), Ernest Benjamin Essamuah; and Managing Director of the Tema Oil Refinery (TOR)/BOST, Kwame Awuah-Darko.
This meeting, and a tour of Petrotrin’s Pointe-a-Pierre refinery, took place during the same week (August 21 to 26) that BOST/ TOR met with senior officials from another state-owned enterprise - the National Gas Company of Trinidad and Tobago (NGC).
This visit was a follow-up to Rowley’s official visit to the West African nation of Ghana during which, on May 9, a Memorandum of Understanding (MOU) was signed between the TT and Ghanaian governments.
NGC and BOST subsequently signed their own MOU in Port-of- Spain on August 24, which will see NGC use its gas and gas pipeline expertise to the mutual benefit of NGC/TT and BOST/Ghana.
However, Petrotrin and BOST are still in discussions about signing their own MOU, but focused on oil; Ghana has two major oil fields, the second of which was commissioned on August 18.
Business Day sought further details on this development from Petrotrin’s Senior Manager, Strategy and Business Development, Imtiaz Ali.
Responding via email, Ali said “BOST was given a tour of the Pointe-a-Pierre refinery. BOST is responsible for the operations of the TEMA refinery in Ghana and are contemplating some upgrade works.”
Regarding the MOU discussions, he told Business Day, “Possible areas of cooperation include technical assistance, supply of crude and purchase of refined products including swaps of crude for products.”
Ali also said Petrotrin is “very likely” to sign an MOU with BOST but could not say how soon this might take place.
Asked about which aspects of Ghana’s emerging oil sector Petrotrin would be most interested in, Ali replied, “At this time Petrotrin would be looking for opportunities for crude supply from Ghana and sale of refined products to Ghana.”
As reported in the September 1, 2016 Business Day article “NGC: Internationalising business”, the oil produced in Ghana is exported “without ever reaching the shores of Ghana”, using a Floating Production, Storage and Offloading (FPSO) vessel.
This means Ghana “sees little benefit” other than the revenues that come back to the country through the monetisation of its oil.
With this in mind, Business Day asked if Petrotrin was considering lending its expertise to establishing onshore refineries in Ghana.
“Yes, if requested,” Ali responded.
While talks are more advanced between NGC and BOST, with a return visit by NGC officials to Ghana likely in the coming months, Petrotrin must first sign an MOU before any official visits are up for consideration.
“We will sign-off on the MOU and take a more detailed look at opportunities. If it is warranted, we may decide to send teams,” Ali said.
Business Day also asked if by the “sale of refined products” to Ghana, Petrotrin was referring to crude oil shipped from that country to Trinidad or from oil Petrotrin acquires otherwise.
Ali stated that the “sale of products will be from Petrotrin’s overall product pool.”
NGC’s Ghana/BOST plans are surely welcome news to stakeholders, especially in light of what Rowley described as “persistent shortages” in natural gas supplies to Point Lisas, which have resulted in “sustained losses to some of the businesses there and significant curtailment in revenues to the Government.”
Similarly, one expects that Petrotrin’s discussions with BOST about being welcomed but even more so because of the potential revenue earnings, as Government “intervenes” to restructure the company’s $20 billion debt, which becomes due shortly, and to “reorganise the company,” as announced by Rowley during his address to the nation last Sunday (September 11).
The PM also said, “Government intends to sit down with the OWTU to engage in deep and far reaching discussions on the way forward for Petrotrin and Trinmar.”
It remains to be seen how Petrotrin will be re-structured but one expects that this will include further talks with BOST/Ghana.
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