Ahart Energy VP: Govt must find a way to repay Petrotrin debt

Vice President of Energy for Ahart Solutions International Randall Mohammed said government must find a way of paying off Petrotrin's debt and said their silence on the matter is one of growing concern to stakeholders in the energy sector as well as the public.

Speaking with Newsday yesterday, Mohammed suggested that in addition to the sale of the refinery to help repaying its debt, the company can form agreements with engineering, procurement and construction contractors for exploration and production of gas. He said while creditors would be interested in a bankable business plan, there may be some concern if they are leading exploration and production.

"It would be interesting to see how they treat with the plant and equipment. I suppose some of it could be sold as scrap metal. My recommendation for exploration and production is that Petrotrin should enter into technical service agreements with contractors to explore and produce in return for a fee.

"In this way Petrotrin retains title to the resources without the burden of exploration and production."

Mohammed also said investors should be prepared to lend assistance to this initative or follow the example of Brazilian Petroleum company Petroleo Brasiliero (Petrobras) and rearrange assets to repay its debt.

"Our local financial sector should be positioning themselves to facilitate. The other option is to take the approach as Petrobras. They have decided to divest some of their oil and gas assets to finance their US $21 billion debt."

Mohammed also said suggestions of privatisation also carry risks as falling prices of domestic crude oil, the ageing plant and large debt would make such a transition unattractive for investors.