Home' Trinidad and Tobago Guardian : October 15th 2015 Contents A5
Thursday, October 15, 2015 www.guardian.co.tt Guardian
INTRODUCING THE HONDA OEM*
$1.00 Per Litre/CNG
*ORIGINAL EQUIPMENT MANUFACTURER.
3 YEARS HONDA WARRANTY
TEST DRIVE ONE TODAY!
Port of Spain: 624-3714 • 625-2277
San Fernando: 657-2277 (CARS)
Chaguanas: 672-0991 • 671-3913
Tobago 639-2277 (CARS)
Global experts including the World Bank and
International Monetary Fund (IMF) have projected
oil price increases---estimated to reach around
US$60 plus---between 2016 and 2017 which could
earn T&T an estimated $10 billion in revenue,
Finance Minister Colm Imbert has said.
This is in addition to a further $5 billion Gov-
ernment is targetting from enhanced revenue col-
lection mechanisms, making for a total projected
revenue of $15 billion by 2017.
Winding up the 2016 budget debate in Parliament
yesterday, Imbert, however, warned that if the
slump in prices continued, Government would have
to look at other "means, fiscal measures and policies"
to deal with the situation.
On projections for the oil price over 2015 to 2025,
Imbert said the World Bank projected the price
would reach approximately US$61 over 2015 and
2016 and US$64 in 2017.
He noted the IMF projected an increase to US$60
in 2016 and US$63 in 2017. The Economic Intel-
ligence Unit also projected a price hike to US$69
in 2016 and US$80 in 2017.
Imbert said the OECD (Organisation for Economic
Co-operation and Development) also projected an
oil price level of US$65 in 2016 and close to US$70
He said assuming world experts were correct
T&T could expect an increase in the oil price of
around US$65 a barrel which was similar to the
projected price for 2015. This price could yield
around $10 billion, he added.
Imbert said accounting firm PriceWaterhouse-
Coopers also estimated that with proper revenue
collection, the proposed T&T Revenue Authority,
and proper co-ordination, collaboration, and col-
lection including VAT collection, Government
would be able to collect some $5 billion in revenue.
Imbert said if the oil price increase occurred
and Government obtained the projected $10 billion
in revenue, as well as reached its $5 billion revenue
collection target, Government should be able to
obtain $15 billion by 2017 and would be on the way
to securing the continued growth and recovery of
He said if there was revenue collection reform
and efficiency, T&T could be on a sustainable path
by 2017. But if it became necessary, the State would
have to use means including the last assets of the
CL Financial group.
The Finance Committee intends to sit over five
days until 8 pm nightly. Up to 6 pm yesterday, MPs
were scrutinising national security with 40 more
state agencies to be dealt with. (Gail Alexander)
Tourism Minister Shamfa Cudjoe and Chaguanas East MP Fazal Karim during the break at the Finance
Committee hearing in the Lower House yesterday. PHOTO: NICOLE DRAYTON
New Petrotrin chairman Andrew Jupiter has
warned that the state-owned company has been
spending much more than it earns and unless this
is quickly reversed, "we may soon go out of busi-
"We believe that Petrotrin has the potential to be
a sustainable business but achieving this goal requires
drastic and urgent change. It cannot be business as
usual," Jupiter stressed in an October 9 message to
the company, which was themed "Facing and Over-
coming Our Current reality."
This followed the new Petrotrin board s first meet-
ing and the message was signed with Jupiter s name,
his designation and the October 9 date with a Petrotrin
letterhead. The message stated: "Today the board
convened its first meeting and we were apprised of
the company s adverse economic situation. Following
our deliberations it was clear the organisation is in
a perilous state and must take steps to address its
Jupiter cited some factors contributing to this,
including high and increasing debt, low productivity
levels, escalating manpower costs, total company
debt now standing at TT$13.28 billion, a US$850
million bond payable in 2019 and other issues.
He added: "The harsh reality is that Petrotrin has
been spending much more than it earns and unless
this is quickly reversed, we may soon go out of busi-
He said oil prices are expected to remain low and
volatile and Petrotrin s projected revenue for fiscal
2015-2016 is unlikely to support its current cost
Also, while refinery margins were able to partly
offset the deficit in the E&P (exploration and pro-
duction), they are unable to sustain the company s
cash flow and net profitability.
Jupiter said: "In order to preserve the company s
sustainability, stringent cost management measures
must be implemented to control expenditure and
improve the efficiency of Petrotrin s operations."
In E&P, he said, current production stood at
approximately 45,327 bpd, inclusive of own/operated
third parties, down from an average of 45,947 bpd
in fiscal 2014-2015.
He added: "The company must therefore rein-
vigorate its E&P operations to accelerate production
in the short term.
"In these serious economic times, forging mean-
ingful partnerships and strengthening stakeholders
relationships are critical. The organisation must also
review its processes and procedures to ensure they
are cost-conscious and effective.
"Although the picture appears gloomy, let us not
forget this company has a combined history of over
100 years and that we have demonstrated our
resilience in overcoming challenges in the past.
"The board of directors is committed to working
closely with management in charting the way forward
for the organisation. However, we are very mindful
that success would be dependent on all parties work-
ing together towards the common good of securing
Petrotrin s viability," he added
He told employees, however, that the situation
presented them with a new opportunity to transform
Petrotrin s reality but noted that "this requires the
realignment of all key stakeholders (management,
employees and collective bargaining bodies) working
together to return the organisation to a state of prof-
itability and stability."
New Petrotrin boss wary of losses:
We may soon go
out of business
• A precipitous fall in
international oil prices.
• Aged assets and
• High operating costs
rendering us (Petrotrin)
• Low productivity levels.
• Escalating manpower
Opposition Whip Roodal
Moonilal claims 2,500
workers may be retrenched
from state-owned Petrotrin
due to the company's current
Speaking in Parliament's
2016 Budget debate on
Tuesday, Moonilal pointed to
recent warnings from
Petrotrin's new chairman
Andrew Jupiter and also to
the company's US$850
million bond which becomes
payable in August 2019.
Moonilal told T&T Guardian
yesterday that the company's
situation has been caused by
debt incurred from the past
People's National Movement
administration, including a
US$850 million bond.
He claimed Petrotrin
management had indicated
preparations for a voluntary
separation plan in respect of
employees and the
Opposition had information
"That's a serious matter. It's
consistent with the
chairman's warnings but all of
Petrotrin's debt and the US
bond were incurred under the
PNM," he said.
Following T&T Guardian
queries to Petrotrin regarding
what measures the company
might employ to deal with its
problems and if staff cuts
might be involved, Petrotrin's
response was that the
chairman sent a message to
the employees after his first
meeting with the board on
Petrotrin added: "Chairman
Jupiter indicated the company
is presented with a new
opportunity to transform
Petrotrin's reality but this
requires the alignment of all
and Collective Bargaining
Bodies) working together to
return the organisation to a
state of profitability and
Factors contributing to
2,500 to 'go,'
Links Archive October 14th 2015 October 16th 2015 Navigation Previous Page Next Page