and Ryan Hamilton-Davis
MINISTER of Energy and Energy Industries Stuart Young has sought to clarify recent news of a deal with Jamaica's refinery Petrojam Ltd by Paria Fuel Trading to secure marine fuel for bunkering in Trinidad and Tobago, saying the country has always imported fuel for marine sale.
Young spoke to reporters on February 3 after the launch of a National Energy Skills Centre Technical Institute (NESC-TI) programme in renewable energy. He said the only thing new about the arrangement is that it brokered a deal to obtain the fuel from Petrojam.
"All this transaction is, we're currently finalising the negotiation to purchase about 500,000 barrels of marine fuel which Paria has been purchasing.
"It is a promotion of our bilateral relationship with Jamaica of which I am very proud, because they're a close partner of ours, as well as Caricom. This is what Caricom is meant to be. So all we're doing is ensuring the principles of Caricom are carried out."
He said this came after some two years of talks with Jamaica's Minister of Science, Energy, Telecommunications and Transport, Daryl Vaz.
"We were importing marine fuel before, but buying it from international suppliers, so when Jamaica came to me two years ago and said to me, 'Can we find a way?' I said, 'Okay, let us open the commercial discussions. Because if there's a deal to be had to be beneficial to us, to be able to purchase from Jamaica at a price cheaper than the international market, that benefits them and us, we will. That is what it is."
He said the fuel bought from Jamaica would be sold at a profit to vessels that enter TT's waters.
"So it is a net foreign-exchange earner and a fraction – 500,000 barrels – compared to 17 million that Paria purchases a year."
Responding to critics, Young reiterated the Petrotrin refinery was closed down in 2018 because it was haemorrhaging money, with government having to write off $12 billion in losses at the time of the closure.
"We could not refine this product in a profitable manner (like) in the way we are purchasing and selling it now."
Asked to clarify further, Young said Petrojam's 38,000 barrel-per-day (bpd) output is a simpler operation and commercially simpler to run than Petrotrin's 175,000 bpd output.
"Remember, we had reached a stage in our production that started in the 2010-2015 period where, unfortunately, our domestic production had dipped below that point and we had to be purchasing. By the time the refinery was preserved and closed in 2018, we had to be importing about 100,000 barrels of oil a day to keep the refinery going.
"Work that out. Today the price of oil might be US$80, 80 by 100,000, that's US$8 million a day, and then when you put it in the refinery, it is refining at a loss. So you're losing on every barrel of oil you refine. That's the state we had reached. That's why the losses had started to be about $2 billion a year."
Further knocking critics, Young said: "Just for the record, for those who are trying to water it down, we have a trade surplus in o
