Nutrien shuts down operations as port fee talks collapse

GLOBAL nitrogen and agro chemicals producer Nutrien has fully shut down its Trinidad operations with 600 workers being sent home, following a collapse in last-minute negotiations with the National Energy Corporation of TT (National Energy) over port and pier facility fees.

National Energy claimed its clients, including Nutrien, had been paying fees which were grossly below market value for decades.

National Energy is responsible for the Savonetta Piers, the Ports of Galeota and Brighton and specialised tugs and workboats.

The release said on assuming office, the board of National Energy realised users of these pier and port facilities were paying "peppercorn legacy rates" and had been doing so for decades.

Some of these Pier User Agreements (PUAs) provided for escalation of rates but this was never triggered be previous boards. National Energy claimed through neglect, omission and recklessness of previous boards and managers, taxpayers were deprived of more than $500m in port and pier fees.

In Nutrien's case, the release said, when its 2006 PUA expired on December 31, 2020, Nutrien demanded a rate lower than that which they enjoyed for the previous 15 years. The board took immediate steps to implement a fair rate for users.

National Energy invoiced Nutrien and all other users a fair rate for use of the pier and port facilities for the periods after the PUAs of respective companies had expired.

While some users made good faith payments and accepted the invitation to meet and negotiate a mutually acceptable way forward with National Energy, Nutrien demanded that the invoiced sum of US$28m be withdrawn as a pre-condition to any negotiation.

National Energy said that the increase in port and pier fees for Nutrien ranged from US$0.02-$2 per metric ton of product, at a time when ammonia prices are the highest they have been, over the last five years, at approximately US$545 per metric ton.

The proposal for new rates was met with a threat by Nutrien to shut down its plants.

National Energy claimed Nutrien's management threatened that any attempt to recover fees retroactively will be met with a PR campaign to paint National Energy as forcing Nutrien to shut down their plants, putting 600 workers on the breadline.

National Energy said it held an emergency meeting with Nutrien on Wednesday and agreed to permit it the continued use of the port and pier facilities until December 31, at the same legacy peppercorn rates Nutrien enjoyed for the past 19 years. National Energy proposed negotiation of a new PUA.

This proposal was put in writing and disclosed to Justice Westmin James before whom an urgent application was made by Nutrien, for an interim injunction to allow access to pier facilities "to allow for shut down operations."

On the proposal being disclosed to the court, the application was withdrawn by Nutrien.

National Energy said its proposal was made in good faith to secure the jobs of 600 workers and provide parties with a suitable foundation to engage in and agree on new terms and conditions.

The release said Nutrien demanded that the National Gas Company (NGC) settle the issue of future gas supply, although Nutrien enjoyed the benefit of an existing gas supply contract.

The release pointed out that neither NGC nor National Energy is responsible for subsidising operations of other companies to secure their economic viability.

"Despite our best efforts, Nutrien has taken the decision to shut down its operations. This decision will adversely affect the lives of over 600 of their employees and their families," the release said.

National Energy added that Nutrien's decision is not one any responsibility can be ascribed to the National Energy or NGC.

The board assured that National Energy and the NGC will work to ensure any disruptions from this decision are minimised. The gas supplied to Nutrien is being reallocated to other downstream plants on the estate.