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US$100 M more needed for GTL plant
NiQuan Energy Ltd—the company taking over the Petrotrin's failed billion-dollar Gas-To-Liquids plant—still has to find more than US$100 million to get the plant up and running.
In a series of email exchanges with the Sunday Guardian between Wednesday and Friday, the company said it planned to raise the money at no cost to taxpayers.
"The plant will now be completed and made operational entirely at the expense of NiQuan Energy and with NiQuan Energy taking on all of the associated risks," company representative Malcolm Wells said.
"This will require a further investment in excess of US$100 million which will be provided entirely by NiQuan Energy without any need for public money. Without any further investment by the taxpayer, Trinidad and Tobago will finally benefit in terms of jobs, revenue and the availability of the cleanest diesel in the Caribbean region and possibly anywhere in the western hemisphere."
The company also distanced itself from the closure of the Petrotrin refinery which has been dominating the media for the past month.
"The shutdown and the future of the refinery is a matter for Petrotrin. NiQuan Energy is a tenant at the refinery and is entirely focused on the completion and successful operation of the NiQUAN GTL Plant, which will produce premium GTL products," Malcolm Wells, NiQuan's representative said in an email.
Wells said the negative dialogue in the public domain about the role the GTL plant played in the shut down of Petrotrin is not impacting on NiQuan's progress.
"NiQuan Energy was never involved in the original project...NiQUAN GTL is not WGTL. We are not moving WGTL forward. The plant we are completing is NiQUAN GTL. NiQuan Energy is an entirely different company," Wells said.
He also dismissed reports that the company was unable to repay a million-dollar loan at the time it was due as "media speculation".
"I’m not going to respond to press speculation," he said.
In terms of job creation, NiQuan said the plant will create some 65 permanent jobs and about 700 during the construction phase. The company will not favour former Petrotrin employees.
"There is no special treatment for anyone. It is fundamental to our philosophy that everyone is treated equally and fairly," he said.
Wells said after the WGTL project was put into receivership, the WGTL facility at Pointe-a-Pierre was subject to an open bidding process managed by PricewaterhouseCoopers (PwC).
"NiQuan Energy was chosen as the preferred bidder because it submitted the only proposal which envisaged operating the plant as a commercial enterprise rather than simply scrapping it," he said. He said it was only after extensive due diligence by the Receiver, multiple governments, and Petrotrin boards, NiQuan Energy was allowed to acquire the plant.
Back in June, the Minister of Energy Franklin Khan issued a statement on the status of the project and said then that the joint venture was put into receivership nine years ago on September 25, 2009. He said that by that time, the budget for the project had increased from US$165 M to in excess of US$399 M.
NiQuan Energy is led by Ainsley Gill and lists its directors as senator David Small and Allison Lewis, who resigned as chairman of the Port Authority of T&T back in March amid the collapse of the sea bridge and the repeated failing of the ferries to service between the islands.
In 2018, according to information from the Ministry of Energy, the Government fully supported NiQuan Energy. The Energy Ministry said the deal was expected to provide Petrotrin with a US$35 million injection, a further capital injection of US$125 million in the economy and some $ 2 billion TT in taxes and statutory payments over the life of the project.
According to the Ministry of Energy, in 2005 World GTL and Petrotrin agreed on a joint venture for the Gas-To-Liquids plant. By January 2006 both companies entered a Shareholders Agreement, giving WGTL 51 per cent equity and retaining 49 per cent for Petrotrin. One year later, the budget and requisite funding was completed and was pegged at US $165 million, funded by a loan of US125 million from Credit Suisse, US $30 million in preference shares from local investors and $US 10 million in equity from Petrotrin.
In summarizing the failed mega-project, the Ministry of Energy said that the credit agreement with the Swiss bank stipulated that the plant should be producing by July 2009, enough to make repayments on the loan. By this time, the project had already cost twice the budget that it was allowed.
In 2009 when the plant was expected to be completed enough to produce, it was way behind the delivery deadline and the cost mushroomed from the US$165 million to more than US$ 399 million. WGTL was unable to fund its portion of the repayments and Petrotrin bought out the entire Credit Suisse loan.
The project was placed in receivership that same year.
By 2010, when the Government changed hands, Petrotrin stopped all funding to complete the project and by 2012, NiQuan Energy emerged as the company interested in purchasing the idle and incomplete GTL plant.
NiQuan was able to purchase the US$399 million project for just US$35 million which included an initial payment of US$10 million and preference shares valued at US$ 25 million to be paid in two tranches.
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