Energy Minister Kevin Ramnarine yesterday suspended the award of a multi-million dollar bunkering licence pending the outcome of a joint evaluation by State-owned Petrotrin and the National Energy Council.
Ramnarine, Bunkers International and its local arm, Bunkers Oil Trinidad and Tobago have come under scrutiny by the Oilfields Workers' Trade Union (OWTU) over the past three weeks. The lack of answers on the state of that licence triggered a shutdown of the Petrotrin refinery last week.
It led to panic buying at gas stations, particularly in central and south Trinidad last week.
"What we are saying is that the consideration of any granting of a licence will take into account the output from the commercial evaluation," Ramnarine said via text yesterday.
In a media release last Friday, Ramnarine sought to explain the issue that has triggered the union-sanctioned protest action at the refinery and fluctuations of work last week.
"No licence has been awarded to Bunkers International or any subsidiary of Bunkers International," he said.
"While Cabinet has agreed to authorise the minister to grant a licence for ex-vessel bunkering to a subsidiary of Bunkers International, the eventual granting of any licence by the minister is subject to due diligence and the meeting of a number of conditions," Ramnarine said.
This latest development comes on the heels of furore from the OWTU after Ramnarine made an announcement at a post-Cabinet press briefing just a little under a month ago.
At that media briefing on August 16, Ramnarine said Cabinet "agreed" to issue a marketing licence to Bunkers Oil Trinidad & Tobago Ltd.
He said then Cabinet also agreed that any fuel being purchased by bunkers from Bunkers Oil Trinidad and Tobago Ltd must be purchased from State-owned Petrotrin.
But the owners of Bunkers International, John and Al Canal had a different view of the arrangement.
In an interview with the Sunday Express last Thursday night, just before they left the country for the United States, the brothers said they have in fact been granted a "conditional licence" by the Minister of Energy.
"There is, as we understand, a conditional licence granted. We have been sent a letter, we have a two-page letter of items we have to address," John Canal said.
Canal said they were contacted "earlier in the year" by the local owners of Twin Island Shipping, Stuart and Tara Jardine, with a view to setting up the subsidiary.
They said the application for the licence was then submitted to the Ministry of Energy in July and they were granted the conditional licence on August 24.
According to company registration documents the local subsidiary, Bunkers Oil Trinidad and Tobago, was registered on July 2.
Both Stuart and Tara Jardine are also listed as directors of the local subsidiary.
"I want to clarify this because there have been reports that it is a brand new company. We needed an operating base in Trinidad, we are going to have employees here, we're going to be writing cheques, we are going to have computers, we're going to be paying taxes and we need a local company to do that," Al Canal said.
Bunkers Oil Trinidad and Tobago has listed its registered business address as #10 French Street, Port of Spain, which is the same address listed for Twin Island Shipping.
"That company (Bunkers Oil Trinidad and Tobago) is 100 per cent owned by the holding company Bunkers International. The Trinidad company is incorporated under that," Al Canal said.
"We, as a company, when we do a press release, we generally wait until we are operational. Clearly we do not have anything in place yet," he said.
The company has been in business for the past 18 years and has several subsidiaries globally, including a fleet of barges near Colombia.
But even with nothing in place the two are "confident" that they can meet all the criteria outlined in the conditional licence.
Canal said he was not at liberty to discuss the details of that conditional licence though he was informed by the Minister of Energy that it was "confidential".
Canal refused to infer on the difference between a conditional licence and an operational licence.
"I can't speak to that as this is the first time we are entering into a business relationship here in Trinidad, so I am not sure," he said.
"Our goal is to respond to the ministry and our sincere hope is that they will say Bunkers International looks like a good partner for the country," Canal said.
There are currently two bunker barges located off the coast of Trinidad, one owned by Petrotrin and the other by Ventrin. Ventrin is operated by former Petrotrin president Wayne Bertrand.
"Our research shows that there are 6,200 vessel calls over the last year. Trinidad will be a tremendous opportunity to go into."
While the Canals are new to the politics of the country, they are long-standing Petrotrin customers.
"We have been buying fuel from Petrotrin for, I want to say about ten years. We buy from them as a bunker trader and we sell to ship owners that they (Petrotrin) do not grant credit to," Canal said.
Because of the limited capacity of the barge, Canal said, they have been forced to take their business elsewhere at times.
"With two barges operating, I don't know what the numbers are, but it would be difficult to deliver 500 ships a year," he said.
"You have vessels that are just sailing away that could be buying a Trinidadian product and that's what we're committed to, we are committed to buying all our fuel from Petrotrin," he said.
"Ship owners are not 100 per cent sure they can count on taking the bunkers from Trinidad, not because the fuel is bad, the fuel is very good, the companies that deliver make good deliveries but the market is under serviced, there aren't enough barges," he said.
"Why these companies have not put more barges into play, I do not have an answer for you on that," Canal said.
Al Canal added that with their 30 barges in Colombia, they service only 5,600 ships.
"There is enormous market potential in Trinidad. So what we are looking to do is expand the market, not detract from it, not take away jobs or economic interest, we are looking to expand the economic interest," he said.
With their input into the bunkering market, even three barges may not be enough to supply the passing ships. But with no restrictions or limitations on the amount of barges they can bring into local waters, the Canals are able to commandeer a larger share of the bunker profit pie.
"In the country's 1990 Foreign Investment Act seem like a good base, which the country said you want to bring in investment, we want to bring in experience and we want to be one of those companies. To us it felt like a welcome, open door," he said.
"To date, up until some of these issues have come up, we haven't felt a sense that we shouldn't apply or that we weren't welcome," Canal said.
"There are a lot of things that ships need and bunker fuel is the foundation item," Al Canal said.
He also noted that with their investment, they would be undertaking all the financial risk, whereas if the State-owned company did it, it would have to use its profits to invest in the growth infrastructure.
"There is great opportunity, but honestly we couldn't bring in 20 barges tomorrow, you have to sort of build it slowly," he said.
Their investment, Al Canal said, could potentially bring in an additional $50 million to $150 million in national revenue within the first two years of business. With that potential revenue in mind, the two admitted to being "concerned" with the negative fallout since the announcement of the venture three weeks ago.
"It is not the reputation that we want to have. We are in some ways a family run company, we are not a big, cold corporation," John Canal said. The two steered clear of any of the issues raised by the union regarding Petrotrin's ability to improve its own bunkering platforms and corner a bigger piece of the lucrative market.
"We cannot speak to anything that is happening with the unions and the Government or Petrotrin. There are a lot of things that we have no control over but we want to be a good partner, a company that shows a good face for Trinidad," he said.
"When you look at Trinidad, my goodness, you have such tremendous resources here, the market is much smaller than it needs to be," he said.