Cur­tis Williams

Yet an­oth­er gov­ern­ment has writ­ten to the Kam­la Per­sad-Bisses­sar ad­min­is­tra­tion ex­press­ing con­cern about its de­ci­sion to ap­prove two projects val­ued at US$5.3 bil­lion to Sau­di Ara­bia's state-owned com­pa­ny Sau­di Ba­sic In­dus­tries Cor­po­ra­tion (Sabic). Tak­ing is­sue with the de­ci­sion is the gov­ern­ment of Japan which, through its Am­bas­sador Tat­sua­ki Iwa­ta, has ques­tioned the price be­ing of­fered by the Saud­is for gas for the projects. The gov­ern­ment of Japan is al­so en­quir­ing whether com­pa­nies that were in com­pe­ti­tion with the Saud­is were led to be­lieve they could on­ly bid on one of the two projects. This means that both the Amer­i­can and Japan­ese gov­ern­ments have now raised is­sue about the de­ci­sion to award to the projects to Sabic. In what has be­come an in­creas­ing­ly con­tro­ver­sial de­ci­sion, the Gov­ern­ment ac­cept­ed Sabic's pro­pos­al to build a methanol to petro­chem­i­cal com­plex and a methanol to olefin plant.

The Sau­di pro­pos­als beat out sev­er­al Amer­i­can and Japan­ese com­pa­nies. There have been con­cerns be­ing qui­et­ly raised about the process be­ing flawed, in­clud­ing al­le­ga­tions from at least one con­sor­tium that it was mis­led in­to be­liev­ing they could not bid on both the methanol to petro­chem­i­cal (MTP) com­plex and al­so on the oethanol to olefin project. In a let­ter dat­ed Jan­u­ary 31, of which the Busi­ness Guardian ob­tained a copy, the Japan­ese am­bas­sador raised the spec­tre of Japan­ese firms be­ing made to be­lieve that the two bids were mu­tu­al­ly ex­clu­sive. In the let­ter ad­dressed to For­eign Af­fairs Min­is­ter Dr Su­ru­jrat­tan Ram­bachan, Iwa­ta called on the min­is­ter to pro­vide the "facts sur­round­ing the present state of con­sid­er­a­tion for the se­lec­tion of the suc­cess­ful bid­der." Am­bas­sador Iwa­ta said: "One of our con­cerns is that we un­der­stood that ac­cord­ing to the re­quest for ref­er­ence for MTP project, it was not ac­cept­able to sub­mit the bids for the said project and the methanol to olefin plant projects si­mul­ta­ne­ous­ly." Sources at the Min­istry of En­er­gy ad­mit­ted to the Busi­ness Guardian that there was some talk about the projects be­ing sep­a­rate and that there were no joint bids, but they in­di­cate that the con­fu­sion was rec­ti­fied well in ad­vance of the pro­pos­als be­ing sub­mit­ted.

"There were some is­sues in terms of the two projects be­ing sep­a­rate and apart. We said they were two dis­tinct projects, but we did not say that any­come was de­barred from par­tic­i­pat­ing in both. We know that a con­cern was raised and we were able to clear that up well in time," said a source at the Min­istry of En­er­gy.

On­ly last month the US Em­bassy raised ob­jec­tions with the Gov­ern­ment award of two projects worth US$5.3 bil­lion to a con­sor­tium led by Sabic. US Am­bas­sador to T&T Beat­rice Wilkin­son Wel­ters wrote to Gov­ern­ment fol­low­ing ma­jor ob­jec­tions raised by US in­ter­ests that they were un­fair­ly by­passed in favour of the Saud­is. That ob­jec­tion led to a one-week post­pone­ment of the de­ci­sion to award the projects to Sabic.

Act­ing Pub­lic Af­fairs Of­fi­cer at the US Em­bassy Alexan­der McLaren, in an e-mail re­sponse, told the Busi­ness Guardian: "The Em­bassy in Port-of-Spain works to en­sure that Amer­i­can firms are aware of the busi­ness cli­mate and of busi­ness op­por­tu­ni­ties in T&T, and that they have equal and fair ac­cess to bid­ding op­por­tu­ni­ties.

"In the nor­mal course of busi­ness, the am­bas­sador will oc­ca­sion­al­ly in­quire about Gov­ern­ment poli­cies and process­es, par­tic­u­lar­ly if there is in­ter­est in a spe­cif­ic project by one or more US firms." Am­bas­sador Tat­sua­ki said his gov­ern­ment was con­cerned that the gas price be­ing of­fered by the Saud­is was low­er than that be­ing of­fered by the Japan­ese com­pa­nies. "The oth­er con­cern is that we had an­tic­i­pat­ed that the cru­cial fac­tor of the MTP project both for the Gov­ern­ment of T&T and the suc­cess­ful bid­der would be the price of nat­ur­al gas. "It is my un­der­stand­ing that the bid­ding price of the Japan­ese com­pa­nies would have been high­er than the com­pa­ny which is be­ing favourably con­sid­ered by T&T." The price that Sabic of­fered was the source of con­tention with­in the Cab­i­net and re­sult­ed in a stand­off be­tween the Min­is­ter of En­er­gy Kevin Ram­nar­ine and his pre­de­ces­sor Car­olyn Seep­er­sad-Bachan. In an­nounc­ing the award to Sabic, the Gov­ern­ment was quick to point out that it was de­pen­dent on the com­pa­ny reach­ing a gas agree­ment with the Na­tion­al Gas Com­pa­ny Ltd.