Refinery and industry uncertainties

THE EDITOR: The energy sector of the economy was not completely excised, it was shuttered. It created a huge blank in the economy and collapsed earnings of foreign exchange drastically.

As things are going, the new uses to which production of energy raw materials are directed will never catch up and fill the voids.

Oil is extracted for immediate export. Some natural gas is made available locally on a rationed basis and, from what is known, overall gas production is marketed on a price-averaging mechanism. Royalties are not recompensing lost margins.

In the old model, foreign exchange was earned by a diversity of actors in the energy industry but now their numbers are fast being reduced and their output is dwindling.

From a business point of view, investing in the refinery at this time would suggest placing a lot of trust and confidence in the Government, future financing availability, future industry structuring and chance.

Government policy has not been settled; supplies of raw material are under the management of three big extraction conglomerates that will be competing in other areas like bio-fuels and niche oil and gas products and downstream activity; and oil and gas currently face very uncertain futures.

E GALY

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