$2.6b to pay retrenched workers

THE Pointe-a-Pierre refinery and its physical assets will be placed in a separate holding company, Finance Minister Colm Imbert said yesterday during his 2019 budget presentation. Government will entertain any viable offer for the refinery, he said, adding that the majority union, the Oilfield Workers’ Trade Union (OWTU) still has first option.

Government and the board of the state oil company had previously denied – or at least refused to admit – any plan to sell the company. Petrotrin was among the most anticipated topics leading up to the budget, and Imbert took his time, waiting nearly an hour and a half into his speech to address government’s plan for the company.

The cost of termination packages for the company’s permanent, temporary and casual employees will be $2.6 billion. The company’s pension plans, he added, have a combined asset value of $10.7 billion, and according to the latest valuation, will meet all obligations and liabilities relating to them.

As it stands, 1,400 employees are eligible for early retirement, while 800 will be recruited for the Exploration and Production Unit, and 200 for the terminalling unit. Petrotrin had been tottering on the brink, he said, and immediate action to save the company was necessary. With these changes, though, he said government was confident the company could “resume its rightful place as a leader in the oil and gas sector and a profitable and efficient entity” after it completes its transition. The refinery’s shuttering process started yesterday, and Imbert said the last fuel production will be October 15, although there would be “significant quantities in storage.”

The company had said earlier that the complete closure would be November 30. The new thrust to E&P could increase Petrotrin’s output to 60,000 barrels of oil per day, and coupled with BHP Billiton’s Ruby Delaware project, crude oil production could increase to 77,500 barrels a day, perhaps even 100,000 bopd. Activity by bpTT, Shell, DeNovo, EOG Resources and BHP could also take gas production from 3.8 billion standard cubic feet per day in 2018 to 4.14 bcf/day in 2021. The Petrotrin restructure was among six of Imbert’s “economic game changers.” Also included were government’s recent announcements of a drydocking facility in La Brea, the success of the National Investment Fund public offer, the Dragon gas deal with Venezuela, Sandals Tobago and a revitalised sea bridge, including the purchase of two new fast ferries.