A&V Oil has won its case against the now-defunct state-owned energy company Petrotrin and stands to benefit from close to $1 billion payment for the failure to honour outstanding bills on the premise that fake invoices were submitted for oil it never supplied.
The company, owned by a close friend of the Prime Minister, now stands to receive the $84 million being held in escrow, to settle an unpaid invoice for crude oil it supplied and damages which are yet to be quantified but could bring the total sum owed to the operator to $1 billion.
These were the findings and decisions by arbiters Sir Dennis Byron, former president of the Caribbean Court of Justice (CCJ), who also served as chairman of the arbitration panel; Lord David Hope and retired CCJ judge Humphrey Stollmeyer, in the arbitration ruling between A&V and Petrotrin, according to details obtained by Sunday Newsday.
In the unanimous decision, the three arbiters held that Petrotrin failed to establish A&V engaged in seal tampering or any inappropriate practices in the process of delivering crude oil and was entitled to payment.
They also held that Petrotrin did not have reasonable grounds for suspecting that A&V misconducted itself and was entitled to compensation for the wrongful termination of the agreement.
Petrotrin’s counter-claim was also dismissed by the three arbiters who held that the company did not have reasonable grounds for suspecting A&V engaged in fraudulent activity.
Contacted on Saturday, A&V’s lead attorney, Ramesh Lawrence Maharaj, SC, said he had not yet read the decision since he had surgery on his eyes earlier in the day.
He referred to Opposition Leader Kamla Persad-Bissessar’s revelations at a public meeting, accusing A&V Oil of supplying fake oil to Petrotrin which was permitted because the lease operator’s owner Nazim Baksh was a very good friend of Dr Rowley.
Maharaj said Persad-Bissessar used an incomplete audit to make her claims and said he immediately wrote to Petrotrin informing them the allegations were false.
He said Petrotrin ignored his letter and, instead, appointed two foreign companies, Kroll Consulting Canada Co and Gaffney, Cline & Associates of the United Kingdom to conduct audits.
Petrotrin hired Kroll to conduct a forensic audit based on a report done by its internal audit department on its exploration and production operations for January to July, 2018. The audit department found the lease operator had overstated its production capacity and supplies for which Petrotrin paid an estimated US$8 million. Kroll confirmed the Petrotrin audit report, which Gaffney Cline also corroborated stating that the Catshill reservoir was not capable of producing the volumes stated by A&V.
Maharaj said he warned if Petrotrin carried out the threat to terminate its contract with A&V, “it would be a reckless act and taxpayers would have to pay millions in legal fees to have an arbitration because A&V would be able to recover all expenses.
“Petrotrin has no evidence to support what the leader of the opposition said and ignored all representations made to it, did not consult with us and terminated the contract.”
Maharaj said it was important that the public knew the findings of the arbitration ruling, and wants the Government to have it laid in Parliament as part of the public record since taxpayers dollars “were spent in a reckless manner."
He also said Persad-Bissessar had a duty to apologise to A&V Oil and Baksh.
“This is not an issue which should be buried in silence…It must be open and transparent for the public to examine it and taxpayers to know how their money is to be spent and if more will be spent in appeals.’
He said he spoke to Baksh who says he wants justice.
Maharaj said he will say more on the ruling once he is in a position to read the decision himself.
In February 2018, Petrotrin announced the termination of the operator’s contract on December 22, 2017, in a bid to protect its interest.
This followed the Privy Council’s denial of permission to A&V to appeal a previous ruling made in the local court of appeal that allowed Petrotrin to terminate the contract, which included the State-owned oil company taking into their possession A&V’s assets.
Messages sent to both Attorney General Faris Al-Rawi and Energy Minister Stuart Young were left unanswered.