S&P Global Ratings has downgraded Trinidad Petroleum Holdings Ltd's (TPHL) rating from BB to B+ in its latest overview on Wednesday.
The company attributed the downgrade to the delayed issuance of TPHL's 2019 consolidated audited financial statements, and the tight maturity profile of upcoming debt payments.
TPHL, parent company of Heritage Petroleum and Paria Fuel Trading, issued a statement on Thursday expressing disappointment with the downgrade, saying "the company (TPHL) has been proactively working through both issues for quite some time, and we expect them to be resolved within short order."
TPHL gave reasons for the issues and ways it plans to address them.
"In April 2021," it wrote, "the company pre-emptively began internal preparations to launch a refinancing process to address significant debt maturities in June 2022.
"In addition to lengthening the debt maturity profile, successful completion of the contemplated refinancing would also significantly reduce borrowing costs given the strong performance of the operating companies over the past two years."
It said it is on the verge of awarding a lead arranger to guide it through the execution of the refinancing exercise, which it expects to be completed by May. This was done, the company said, after months of discussions with all stakeholders to ensure "a thorough, cost effective and transparent process."
Refinancing will allow the company to meet its near-term debt obligations, its said, adding that it is one of the actions that may lead to an upgrade from S&P within the next year.
As it pertains to the 2019 audited financials, TPHL said it has engaged its lenders and the ratings agencies outlining the challenges it faced "on numerous occasions" in issuing the consolidated statements.
"The complications are a result of the 2018 reorganisation of the company, updated audit parameters, significantly lower materiality threshold, specialist reviews relating to the presentation of the financial statements after the reorganisation, pension obligations and asset valuation that were not represented in previous audits."
The 2019 TPHL financial statements, it said, can only be completed after the 2019 Petrotrin financials are finalised.
"We expect both to be completed and issued within a matter of weeks, thereby putting this issue behind us shortly."
JTUM president Ancel Roget said the downgrade showed that TPHL "was a failure", following the closure of Petrotrin in 2018 and the restructuring of its assets under the holding company.
He accused the TPHL of mismanagement, despite assurances it was performing and paying taxes by the late energy minister Franklin Khan.
"It was a case of himself to himself," Roget said.
"They are many putting many thousands of workers on the breadline and a community under pressure," he added during a demonstration in San Fernando.
He said the OWTU, which represented Petrotrin workers, felt vindicated.
The OWTU had made several bids for the refinery which government rejected. Government in 2021 s
