On 18 October 2018, almost one year ago, a doleful Mr Ancel Roget was pictured, in a photograph supplied by the OWTU, between two prospective partners, announcing their bid to acquire the Petrotrin assets. One company, Sunstone Equities, appeared from the news report to be a facilitator of government-private sector integrated deals and the other, MAK England, was touted as the supplier of top management and the supplier of crude oil and other logistics.
Sunshine Equities representative John Van Dyke characterised their bid competitors as ‘piranhas seeking to ravage (Trinidad’s) asset’, which they described as ‘a very profitable refinery’. One could only surmise that the thin resumes of these companies may have been weighing on Mr Roget’s mind, at a time that he should have been happy.
A white knight, which is presumably how the speaker saw himself, is a party who comes to the aid of a distressed business with the support of the board and management. The entity doing the rescue is perceived to be well-disposed to the business and is not minded to strip the assets of the business to benefit themselves.
On the other hand, piranhas seek to seduce the board and management into believing that they are working for the company’s benefit (if they did not, they would not get close) but in reality, are akin to corporate bandits, out to make a fast buck at the expense of the company. They denude the company of its assets even while they make large returns.
It is as your mother told you; you must know who your friends are. Or as Jesus said, not everyone who says, ‘Lord, Lord will enter the kingdom of heaven’. We must, therefore, play the child’s game—‘examine the horns, there is a traitor on board’—when a visitor to our shores suggests that piranhas are lurking.
Fast forward to September 2019, both Mr Khan and Mr Imbert identified that the vehicle to be used by the successful OWTU-Patriotic Energies and Technologies Co.Ltd.(PETCL) will be partnered by Trafigura, touted as the second-largest global oil trader. Mr Imbert characterised the bid as ‘good for the country, the workers and the trade unions’.
An unspoken motivation in the bid decision appears to be an early start up of work on the refinery—in early 2020. Very generously, Mr Imbert ‘gives back’ the upfront cash offer, the defining difference between the final bids.
This endorsed turn of events shakes my faith in our vision for the country. I am stunned by the decision and the recent associated commentary by our elites, who have been either rapturously singing praises for the organisational breakthrough or have been asking unanswered questions specific to the transaction.
We have blissfully handed this market ‘with the lowest fuel rates in the Caribbean, because of Petrotrin’ and the refinery asset to non-strategic investors—if Trafigura takes up the intended role of MAK England. We are fooling ourselves into thinking that there are wholesome benefits to accrue.
There is no local appreciation of the history of Trafigura in our region, be it in Jamaica (where the PNP/Portia administration is still at the privy council over a J$31m payment made surreptitiously in 2006 to the party and for which the party officials are trying to avoid addressing in open court ) or in Brazil with the infamous Operation Carwash scandal (which involved every major oil dealer and where the company has now sought to distance itself from Carlos Herz).
We are setting ourselves up for a re-run of the ‘ISCOTT to ISPAT’ movie. Remember, we could not run ISCOTT and so we sold it to the Mittals, who made it the foundation of their global wealth? Our energy costs were a deciding factor, while they hauled the raw iron all the way to Indonesia. (Piercy, 2008)
Remember what happened in the end? We apparently enjoy playing the role of the ‘sucked-out orange’ in the maelstrom of global business. Will we do it twice?
Simultaneously, we ignore the results of both April 2014 and the May 2019 deep and shallow water bid rounds, which were significantly undersubscribed and could be considered failures. Two blocks, in the latter bid, were awarded to a joint bid between BPTT and Shell. This reflects a hedging of bets by both parties and the relative global unattractiveness of our fields.
Mr Imbert reportedly would soon announce that the same team (BPTT/Shell) would be awarded a utility-scale solar contract (Business Guardian, p. BG5,October 3, 2019). Ms Ollivierre, in June 2019, disclosed that these players had submitted such bids over two years ago. But we operate in a confused state since Mr Le Hunte, Minister of Public Utilities, in the same June conference indicated that we produce more electricity than we consume, causing the government to go slow with renewable energy.
Ms Fitzpatrick, the BPTT head, then rebutted: “… the less energy we use to run our operations means the more gas to send to the petrochemical and LNG markets”.
Do our elites—political, business, unions or academics—or wayside commentators, like me, stop to consider the vast implications of these developments? Do we connect the dots or are we so focused on the shiny toy of PETCL?
Point Lisas would have remained a pipe dream with this unimaginativeness. Oh, for the days of Robert Montano. It seems as if the banks are flush with cash, but our businessmen are cautious traders.
What is our future? There is no apparent energy policy, nor it seems, entrepreneurial desire. We, as a nation, appear determined to run what George Beckford called a ‘plantation economy’.
I am confused. I do not know who the white knights are and who are the piranhas.