Monday, December 18, 2017

Petrotrin contacts authorities over 'fake oil'

...after independent consultant confirms audit findings

An aerial view of Petrotrin's Pointe a Pierre Refinery. Photo: Richard Charan

PETROTRIN says it now has independent confirmation of the discrepancies between the oil production reported by a contractor and what was actually received by the company, which resulted in an over-payment of an estimated $80 million.

As a result, the company is moving to notify the “relevant authorities”.

The disclosure was made in a statement by Petrotrin on Friday afternoon.

In September, Petrotrin hired external consultants Kroll Consulting Canada Co. after an internal audit report found alleged collusion involving an employee and an oil supply contractor which resulted in the overpayment.

The audit report also found that the oil being supplied by the contractor from its Catshill Field wells increased by more than 150 per cent during a 10 month period, and that Petrotrin was billed for oil it never received.

Details of the internal report were disclosed on the political platform by Opposition Leader Kamla Persad-Bissessar. It led to threats of legal action by the contractor against Persad-Bissessar and Petrotrin.

Petrotrin said on Friday that its initial findings were confirmed in a report submitted by Kroll following the completion of the forensic audit commissioned by the Company's Board into the reported discrepancies.

An additional report, commissioned from global oil and gas consultants Gaffney Cline last week, also found that the reservoir was not capable of producing the volumes in question, the company stated.

“In addition to auditing the period January to July 2017, the Board has since commissioned Petrotrin's Internal Audit Department to widen the scope of its investigation into matters dating back to 2016”. 

Following the Board's receipt and review of the Kroll and Gaffney Cline reports, Petrotrin's Chairman Wilfred Espinet has confirmed that the Company would now be moving to take the appropriate actions internally and to bring the matter to the attention of the relevant authorities. 

The Chairman cautioned, however, that while the reports confirmed the discrepancy found by the internal audit, it was critical for the Board to continue to exercise due care and deliberation in how it proceeded. 

Espinet stated in the release: “While we plan to take decisive action, we need to ensure that any claim or action we take is not impeded by a misstep. In this case, doing it right is more important than doing it quickly, and so it would be premature to articulate any specific actions at this time.”