Trinidad Petroleum Holdings

Last updated

Trinidad Petroleum Holdings
Company type State-owned enterprise
Industry Oil and gas industry
Predecessor Petrotrin
Founded5 October 2018 (2018-10-05)
Headquarters
Port of Spain, Trinidad
,
Trinidad and Tobago
RevenueDecrease2.svg TT$4.739 billion [1]
Decrease2.svg TT$1.257 billion [1]
Decrease2.svg TT$881.899 million [1]
Total assets Decrease2.svg TT$10.196 [2]
Total equity Increase2.svg TT$2.013 [3]
OwnerGovernment of Trinidad and Tobago
Subsidiaries Heritage Petroleum Company Ltd.
Guaracara Refining Company Ltd.
Paria Fuel Trading Company
Website trinidadpetroleum.co.tt

Trinidad Petroleum Holdings is a state-owned oil company in Trinidad and Tobago. Its principal activities are the exploration, development, and production of hydrocarbons, operations it conducts through its primary subsidiary, Heritage Petroleum Company Ltd. Trinidad Petroleum Holdings also owns Guaracara Refining Company Ltd, which operates the nation's only petroleum refinery. It also owns the Paria Fuel Trading Company subsidiary, which imports refined petroleum products, and stores and distributes them domestically.

Contents

Corporate history

Creation of TPHL

The history of the Trinidad and Tobago national oil company can be traced to 1969, when the government established the National Petroleum Company. The company, the Trinidad-Tesoro Petroleum Company Ltd, was a partner in a joint venture with Tesoro Corporation, and was formed to acquire the assets of British Petroleum as it exited operations in the Caribbean. (The government bought out Tesoro in 1985, and changed the name of the company to Trinidad and Tobago Petroleum Company Ltd [Trintopec].) In 1974, the government bought the local assets of Shell Trinidad Ltd, and formed a new national oil company, the Trinidad and Tobago Oil Company Ltd (Trintoc) to hold and operate them. The government formed a third national oil company, Trintomar Ltd, in 1988. A joint venture of Trintopec, Trintoc, and the government's National Gas Company, it took over the assets of the South East Coast Consortium, a joint venture of foreign multinational oil companies producing oil off Trinidad's southeast coast. [4]

In 1994, the government merged Trintopec and Trintoc into a new company, Petrotrin. Trinmar merged into Petrotrin in 2000. [5] Petrotrin faced conflicting goals. It had to convince foreign multinational oil companies to partner with it in exploration, development, and production activities. These companies refined the hydrocarbons and sold them back to Petrotrin at a mark-up so Petrotrin could meet domestic gasoline, diesel fuel, natural gas, and other needs. At the same time, Petrotrin was responsible for managing the country's sole petroleum refinery, whose existence undercut the profits foreign oil companies might expect from selling refined products back to Trinidad and Tobago. Petrotrin was unable to balance these conflicting goals.

By 2017, Petrotrin was in financial trouble. It had lost TT$8 billion since 2012, was TT$12 billion in debt, and owed the government TT$3 billion. It had so mismanaged its own infrastructure that it needed TT$25 billion to make repairs and upgrades. [6] In mid 2018, the government announced that Petrotrin would be dissolved. Trinidad Petroleum Holdings Limited (TPHL) was incorporated on 5 October 2018, with the government of Trinidad and Tobago the sole shareholder. [7] On 1 December 2018 Petrotrin was dissolved. Its petroleum exploration, development, and production assets and responsibilities were distributed to a new corporation, Heritage Petroleum. Ownership of its refinery (shuttered since August 2018) was transferred to a new company, Guaracara Refining. The assets and responsibilities of its fuel import and distribution business were given to a third new firm, Paria Fuel Trading Company. A fourth corporation, Legacy Petrotrin, was responsible for settling Petrotrin's debts and handling other "legacy" issues. [7] [8]

TPHL corporate history

Mike Wylie was named the chief executive officer of TPHL. All of Petrotrin's workers were laid off, and TPHL rehired about 40 percent of them. The government loaned TPHL TT$1.2 billion to help cover the cost of restructuring and to meet short-term debt. TPHL refocused its corporate goals on petroleum exploration, development, and production, and began making monthly crude oil exports again, with production of 38,000 barrels of oil per day (bpd) and 110,000,000 cubic feet (3,100,000 m3) of natural gas per day. [8]

Wylie took a medical leave of absence in early August 2019 [9] to seek treatment for colon cancer. [10] On August 21, Wylie was terminated as CEO by the government, which explained that TPHL could not afford to have its CEO absent for eight months. Additionally, the government dismissed several individuals from the board of directors of TPHL and its subsidiaries, [10] including chairman Wilfred Espinet (the former chairman of Petrotrin). Attorney Michael A.A. Quamina, a close associate of Prime Minister Keith Rowley, was appointed the new TPHL board chairman. He also assumed the chair of the board of directors of Heritage Petroleum. Newman George, the retiring chair of the Trinidad & Tobago Housing Development Corporation (HDC) (an agency of the Ministry of Housing & Urban Development), was appointed chairman of the board of directors of Paria Fuel Trading Company and Guaracara Refining. [11]

In September 2019, TPHL announced that it would be selling the Pointe-a-Pierre refinery, the nation's only petroleum refinery, to Patriotic Energies and Technologies, a company owned by the Oilfields Workers' Trade Union. The sale was worth TT$500 million. The sale was revoked in February 2021 after Colm Imbert, Minister of Finance, said that Patriotic Energies lacked the financial ability to finalize the sale. Imbert pointed out that the government was being asked to loan Patriotic the cost of the sale plus all interest, which he characterized as "giving away" the refinery. [12]

S&P Global Ratings downgraded TPHL's bond rating from BB to B+ in February 2022 after TPHL delayed issuing its 2019 audited consolidated financial statement. TPHL said the delays were caused by ongoing issues with Petrotrin's restructuring and the resolution of debt and sale of assets. [13]

Paria Fuel Trading Company diving tragedy

On 25 February 2022 at around 3pm, five divers became trapped in a Paria Fuel Trading Company oil pipeline while making repairs to the pipe. [14] Unbeknownst to the divers, differential pressure had been created when the pipe was cleared of oil nearly a month earlier. While four of the divers were removing an inflatable plug, they got sucked into a vortex pulling them into the oil pipe. [15] Despite efforts by the diving community, only one of them, Christopher Boodram, was able to escape after crawling his way down the pipe for around three hours. [15] [16]

A GoPro camera was recovered from one of the deceased divers, Kazim Ali Jr. Audio recording from the camera shows that all five men were alive after being sucked into the oil pipe, and in the audio they are heard praying and comforting each other. [17]

Paria admitted they had no rescue plan, citing that they had 'no legal responsibility to rescue the men'. [18] Further external attempts to save the men were reportedly blocked by Paria. In November 2023, the Commission of Enquiry found that "Paria's negligence could be characterised as gross negligence and consequently criminal". They recommended that the Director of Public Prosecutions "consider charging Paria with what is commonly known as Corporate Manslaughter." [19]

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References

  1. 1 2 3 Trinidad Petroleum Holdings Limited (21 June 2021). Heritage Petroleum Company Limited and Its Subsidiaries Consolidated Financial Statements for the Year Ended 30 September 2020 (PDF) (Report). p. 7. Retrieved 17 May 2022.
  2. ↑ Trinidad Petroleum Holdings Limited (21 June 2021). Heritage Petroleum Company Limited and Its Subsidiaries Consolidated Financial Statements for the Year Ended 30 September 2020 (PDF) (Report). p. 5. Retrieved 17 May 2022.
  3. ↑ Trinidad Petroleum Holdings Limited (21 June 2021). Heritage Petroleum Company Limited and Its Subsidiaries Consolidated Financial Statements for the Year Ended 30 September 2020 (PDF) (Report). p. 6. Retrieved 17 May 2022.
  4. ↑ "Historical Facts on the Petroleum Industry of Trinidad and Tobago". Ministry of Energy and Energy Industries, Trinidad and Tobago. 2022. Retrieved 20 May 2022.
  5. ↑ "Trinidad's state-run Petrotrin to cease oil refining operations". Reuters. 28 August 2018. Retrieved 20 May 2022.
  6. ↑ Felmine, Kevon (14 March 2019). "Turnaround possible for Petrotrin". Trinidad & Tobago Guardian. Retrieved 20 May 2022.
  7. 1 2 Trinidad Petroleum Holdings Limited (12 September 2019). Trinidad Petroleum Holdings Limited 9.75% Senior Secured Notes due 2026 (Report). p. 1. Retrieved 20 May 2022.
  8. 1 2 "New Trinidad Petroleum Holdings Management Stresses Government Support After Petrotrin Organizational Restructuring". Reorg. 5 March 2019. Retrieved 20 May 2022.
  9. ↑ Sing, Kimoy Leon (15 August 2019). "UNC questions Heritage CEO's sick leave". Trinidad Express. Retrieved 20 May 2022.
  10. 1 2 Haseley, Marshelle (2 September 2019). "Arlene Chow new Heritage CEO". Trinidad and Tobago Newsday. Retrieved 20 May 2022.
  11. ↑ Alexander, Gail (22 August 2019). "Espinet replaced, Wylie to lose Heritage job". Trinidad & Tobago Guardian. Retrieved 20 May 2022.
  12. ↑ Grelsford, Robert (21 July 2021). "Trinidad and Tobago seeks new partners to restart idled refinery". Oil & Gas Journal. Retrieved 20 May 2022.
  13. ↑ Gioannetti, Andrew (4 February 2022). "Trinidad Petroleum vows to fix debt issues after S&P ratings downgrade". Trinidad and Tobago Newsday. Retrieved 20 May 2022.
  14. ↑ Douglas, Sean (28 December 2022). "Seeking the truth about the Paria diving tragedy - Trinidad and Tobago Newsday". newsday.co.tt. Retrieved 15 October 2023.
  15. 1 2 "Paria Fuel tragedy survivor plagued by nightmares, flashbacks'I am scarred for life' - CNC3". 23 February 2023. Retrieved 15 October 2023.
  16. ↑ "Paria diving tragedy: A timeline of events". Loop News. 28 February 2022. Retrieved 7 March 2023.
  17. ↑ Ramdass, Anna (22 March 2022). "Paria pipeline diver was wearing GoPro camera: Where is it?". Trinidad Express Newspapers. Retrieved 15 October 2023.
  18. ↑ "Paria's lawyer: Company had no legal responsibility to rescue LMCS divers". Trinidad and Tobago Guardian. 13 January 2023. Retrieved 6 September 2023.
  19. ↑ "The Paria Recommendations - Full Report". Trinidad Express Newspapers. 19 January 2024.
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