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Thursday 21 February 2019
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Caricom markets safe says Khan

Energy Minister Franklin Khan PHOTO BY SUREASH CHOLAI
Energy Minister Franklin Khan PHOTO BY SUREASH CHOLAI

Energy Minister Franklin Khan said Caribbean Community (Caricom) member states which have contracts with Petrotrin for supply of refined products have no need to fear.

Khan said while the company will be going out of the refining business which is no longer viable, they will be importing enough refined products to continue their export to markets in the region.

Petrotrin’s chairman Wilfred Espinet on August 28, announced Cabinet’s decision to close the refinery and separate some 2600 workers.

The issue about the troubling issue with Caricom contracts was first raised by president general of the Oilfield Workers Trade Union Ancel Roget.

Roget said prime ministers in the region, whom he did not identify, had expressed their concerns to the union about the future of their contracts which fuelled their respective economies.

Roget also said the lack of communication between the government of TT and the Caricom prime ministers had left them very uncertain and fearful about their future supply as alternative sources outside of the region would attract the Common External Tarrif (CET) and increase the price of their imports.

Roget said Petrotrin supplies diesel, gasoline, aviation fuel to Jamaica, Grenada, Barbados, St Lucia among other countries.

During Friday’s sitting of the Grenada Parliament, leader of Government Business Gregory Bowen raised similar concerns about the increased prices Grenada and other Caricom countries would have to pay if Petrotrin is unable to maintain the contracts.

Bowen said Petrotrin supplies 70 per cent of the regions’s needs and on October 1 when the refinery closure takes effect they will have to seek alternative sources as the storage capacity these countries have is not substantial.

Prior to the statement by Bowen on Friday, Newsday questioned Khan about the viability of contracts with regional and extra regional countries pending the closure of the company.

Khan who attended the signing of the Cooperation Agreement for the Development of a Dry Docking facility at La Brea said he knew there are contracts to supply Caricom markets but he was not sure about contracts to supply extra regional markets.

He said government would honour these contracts.

“The only difference that is occurring is that your stock of products will no longer be coming from a refinery that you own and manage.”

He said in the first instance the refinery would be converted into a terminalling and bunkering facility. He said there is tremendous storage capacity, noting that Petrotrin previously refined 150,000 barrels of oil. He said it also has a good port.

“We will be transforming ourselves into a terminalling facility where we will be importing finished products more than we will use in the local market and reexport it to the Caribbean island.

“The only difference between this model and the refinery model is that the refinery would not be producing the fuels.

‘We will be importing the fuels and because we will be importing in bulk we would get it cheaper and able to redistribute it to the Caribbean. So, we may well make the same amount of money,” Khan said.

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