|Espinet: Petrotrin not viable in current form |
Thursday, September 7 2017
Government has named businessman Wilfred Espinet as chairman of the State-owned oil company Petrotrin, with a mandate to turn around the company in the next two or three years from being a “ward” of the state to a profitable oil company, contributing profits and other benefits to the economy.
Prime Minister Dr Keith Rowley announced the appointment of the new board during an early morning news conference at Piarco International Airport on September 1 as he left the country for a week-long vacation and medical checkup in California, USA.
Rowley said achieving this turnaround will call for “a certain amount of resolution, a certain amount of robust examination and a certain amount of acceptance that the situation is very serious.” He said that Petrotrin had run up huge debts, “significant liabilities which the company cannot now discharge” and those liabilities have to be paid by the Minister of Finance even while the minister is struggling to pay other expenses of the country.
He said the first of those debts is a single payment of US$850 million which comes due in 2019, with a similar but smaller payment to be paid shortly afterwards. While the company is carrying these huge debts, Rowley pointed out that its oil production has been falling considerably and its infrastructure is old and poses concerns, including safety issues and the risk of oil leaks into the Gulf of Paria which could pollute the Venezuelan coastline with “huge consequences.” Rowley said the cost of cleaning up an oil spill of such magnitude could bankrupt the country.
He said the company’s refinery was also a cause for concern, because at current oil prices, it was refining oil at a loss. He said it was questionable whether the current arrangement under which the State has to give Petrotrin money to buy oil to refine and lose money doing so was sustainable.
He described them as serious issues, adding if they are not addressed promptly and creatively they can threaten the country’s financial arrangements and result in the downgrade of Trinidad and Tobago as a whole, which in turn would increase the cost of borrowing when the country needs to borrow.
Rowley said that Petrotrin needs to begin drilling for oil almost immediately.
“Oil is in the ground and if you don’t drill you don’t get it. Petrotrin has not been drilling, has not been able to drill largely because of its serious financial constraints, and if you don’t treat with those financial constraints your very existence is to be questioned because if you cannot drill...an oil company that cannot execute a drilling programme and bring oil onto the market is on the wrong track.” He said “significant” sums of money would have to be spent to upgrade Petrotrin’s infrastructure, beginning with the parts which are of greatest priority and is one of the earliest matters the board will have to deal with.
He named Reynold Ajodhasingh as vice chairman. Other Board members are: Joel Harding; Nigel Edwards; Anthony Chan Tack; Linda Rajpaul; Eustace Nancis; Randhir Rampersad and Selwyn Lashley Rowley said these men and one woman had been carefully selected for their business experience and expertise in their chosen fields. It was not a clean sweep, as the prime minister admitted that two members of the previous board had been re-appointed. “We were looking for a particular skillset and in looking at the skillset we brought in new people and we kept some people.” He said in the Cabinet discussions it had been decided to rotate the board members so that the entire board is not changed at the same time. He added that it wasn’t possible to do it this time but in the future “a certain number of persons would come off the board and a certain number would stay so that at any given point in time you would have continuity on the board.” Reached by Business Day for comment, Espinet said the board had not been appointed nor sworn in as yet and so he could not speculate as to what their priorities would be. He said that upon being sworn into office he imagined the Government would give directions on its objectives for the company. He declined to discuss the operational requirements, saying they all seem pressing. Nevertheless, Espinet said it was clear that Petrotrin is not viable in its current form and the first thing the board will have to do is establish credibility so that it could bring governance to the process of managing the company.
He said the committee set up by the government to study the company was very clear that nobody could come in from the outside, read a few reports and come up with a solution for Petrotrin.
He added that Petrotrin is very big and complex, and the committee was very clear that a system and structure of proper governance is what is required. The question is how to give the company’s stakeholders the comfort that what is going to be done is going to be done properly.
According to Espinet, the board will have to get clear in its mind what are the company’s objectives because there was confusion over Petrotrin’s objectives. However, he said when they get their instruments of appointment they will be given clarity on what are the objectives of the company and then the directors will have to respond, “first and foremost to the company.”
Wilfred Espinet Wilfred Espinet, named by Prime Minister Dr Keith Rowley as the new chairman of the Board of Petrotrin, has extensive international experience in manufacturing, shipping and retail in several countries. He is currently chairman of Trinidad Cement Limited; Aeromarine International Logistics company; Mayfair Trinidad Limited; Caribbean Express Limited; and Towers Marina Limited. He was executive director/ vice president of Associated Brands Company Limited from 1974 – 1993.
Reynold Adjodhasingh Petrotrin’s new vice chairman, Reynold Adjodhasingh has 34 years of experience in the oil and gas industry in Trinidad and Tobago; Egypt and Azerbaijan. He has worked with Texaco; Amoco and BP and says his experience is mainly in finance, accounting, control, systems implementation and ethics and compliance.
“I have held executive leadership positions at BP in Trinidad and Tobago and Azerbaijan, managing large teams in diverse cultural settings, building talent, driving change and efficiency, delivering results with high standards of ethics, compliance and integrity.” He holds a BSc in Industrial Management with Honours from the University of the West Indies; was BP’s Regional head of Control and Financial operations for its Azerbaijan, Georgia and Turkey region from 2010-2016 and from 2001 to 2010 was head of Control and Financial Operations at BP Trinidad and Tobago.
Joel Harding Joel Harding has been an international Commercial/Contract and Procurement manager with over 30 years in commercial management of projects in energy, commercial, mixed-use and residential markets in Trinidad and Tobago for British Gas and served in Dubai and Azerbaijan for Mace International. In Dubai, he was senior procurement specialist on the construction of the Dubai World Trade Centre and was responsible for all Mace International’s procurement in Azerbaijan. He served as Contracts and Procurement manager with British Gas Trinidad and Tobago from 2004-2007.
Nigel Edwards Nigel Edwards has been vice president, Finance, of the Trinidad and Tobago Unit Trust Corporation since 2013. He has held positions of chief executive officer at TATIL Life Assurance Limited; executive director - Investments at TATIL Life Assurance; and Finance director at ANSA Merchant Bank. He is a member of the Association of Chartered, Certified Accountants (ACCA), holds an MSc in Finance from the London Business School and a BSc in Management Studies with Second Class Honours from the University of the West Indies.
Selwyn Lashley Selwyn Lashley is Permanent Secretary in the Ministry of Energy and Energy Affairs.
A lawyer, he also holds an MSc in Natural Gas Engineering from the Illinois Institute of Technology in Chicago and a BSc in Chemical Engineering from the University of the West Indies.
Linda Rajpaul Linda Rajpaul is an attorney with the law firm B.D. Hewitt and Company and holds certifications in Pension Administration, Alternative Dispute Resolution and Procurement. She has served as legal consultant specialising in corporate, succession and land law; provided legal consultancy services to the Port of Spain City Corporation; the Housing Development Corporation; the Vehicle Maintenance Corporation of Trinidad and Tobago (VMCOTT). Among other things, she also served on a team to negotiate and make recommendations for the upgrade of Petrotrin’s Pointe a Pierre refinery.
Anthony Peter Chan Tac k Anthony Peter Chan Tack is a chemical engineer who has served as chief executive officer at TITAN Methanol Company; managing director of Methanex Trinidad Unlimited and president of Atlas Methanol Unlimited. In his resume, he cites four years of experience in project management and plant management of world scale methanol plants; and 34 years of experience in process and project engineering. He served as a director of Petrotrin from 2002 – 2008 and held various senior and executive management positions for some 26 years.
Eustac e Nancis Entrepreneur Eustace Nancis describes himself as a strategic thinker and planner with outstanding leadership and team building strengths which generates optimum productivity and performance.
He is “committed to accomplishing corporate objectives with a proven history of delivering exceptional profit results,” he says in his resume. He started his first business, a welding shop, in 1980, then established the Arima Door Centre in 1984.
In 1994, he formed Arima Door Centre Holding Company Limited as a real estate development company; then in 1999 he formed General Farms Limited to supply poultry products and in 2001 he established Polyplas (2002) Limited to manufacture plastic water tanks. In 2007, he founded the Savannah Greens Development Company, a land development company.
Randhir Rampersad Randhir Rampersad is a mechanical engineer with a BSc in Mechanical Engineering from Florida Institute of Technology. He is operations manager at Industrial Engineering Specialists Limited; Import Sales manager at Heavy Equipment Imports and Logistics Limited.