Now that the suggestion is being touted that the Guyana Government should consider partnering with neighbouring Trinidad and Tobago (T&T) to utilise its oil refinery (Petrotrin) and save that facility from total collapse, outspoken social activist and chartered accountant Christopher Ram has said that company’s history must first be studied.
Ram told Guyana Times International on Tuesday that both countries belong to the same common economic area and have a vested interest in ensuring growth in the entire bloc. As such, he thinks the David Granger-led Administration can cooperatively work with not only Trinidad, but other countries, to the benefit of Guyana.
However, the chartered accountant said his major concern is what led to the failure of Petrotrin. This, he opined, had to do partly with corruption and partly with inefficiencies.
“After our mindboggling incompetence with the oil contract, I don’t think I would recommend entrusting the end product of the sector in the hands of Trinidad, which has done such a poor job in its oil and gas sector,” he asserted.
Individuals in civil society have raised concerns over the idea of Guyana utilizing the T&T oil refinery, claiming the Trinidadians, not Guyanese, are likely to benefit from that arrangement.
Ram says the argument has merit, but the question must be asked whether Guyana is prepared as a country to build its own refinery.
“Are we prepared as a country, to build our own refinery? If we can enter into a refining agreement with T&T with strong guarantees and on terms that are competitive; if anything else, I think it is something we should consider,” he said.
Besides that, Ram also believes that given the volume of production that constitutes Guyana’s share, Government has to begin thinking about refining its own oil. He feels that unless Guyana can get the oil onshore, the country will never see the true benefits of that particular opportunity.
As such, he said, at this point, everything should be looked at, and nothing should be taken off the table. He also criticised comments made by former Minister of the Natural Resources and the Environment, Robert Persaud, criticising the idea about the oil refinery which was pitched by former Prime Minister of T&T, Kamla Persad-Bissessar.
Robert Persaud has said Guyana should not be used as a ‘rainy-day friend,’ as the asset-rich country is due to become the next largest oil and gas economy of the Caribbean. But Ram said, “He was just trying to inject himself in Guyana’s affairs, and rules out something that I’m not sure he had enough time to think about,” he observed.
Persad-Bissessar, who happens to be the twin island republic’s Opposition Leader, said to the Trinidadian press recently that she believes her country should attempt to partner with Guyana, as oil production is set to begin in 2020.
She said even if Guyana moves to build its own refinery in the future, the Petrotrin facility can still be used in the initial years of oil production.
In response, Vice-President and Foreign Affairs Minister, Carl Greenidge, said the idea is good in principle, but would need to be discussed further.
“The cost associated with the processing by the specific facility; volume is another dimension; and then there are a number of other issues to be examined, as far as I am aware,” he told sections of the local media.
Greenidge also noted that the two governments would sign a Memorandum of Understanding (MoU) at the end of September. “Guyana and Trinidad are looking at an MoU covering energy, and there will be, later this month, a conclusion of that MoU,” he said.
In May 2018, Pedro Haas, Director of Advisory Services at Hartree Partners, conducted a feasibility study for an oil refinery in Guyana, estimating that it would cost approximately US$5 billion to construct a refinery producing 100 barrels per day.
Following that study, there were several discussions in regard to whether Guyana could afford such a facility. Natural Resources Minister Raphael Trotman had stated previously that Government would not be going ahead with constructing an oil refinery. He said Government cannot afford such a large investment, but at the same time, he welcomed such investments by the private sector.
In fact, the Natural Resources Minister had said that talks were buzzing about building a much smaller modular oil refinery, and Government is prepared to give favourable consideration that can meet good standards and guidelines.
Petrotrin has a refining capacity of 140,000 barrels per day. (Samuel Sukhnandan)
