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Friday, April 25, 2014
Trinidad & Tobago Guardian Online
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PP stamping out diesel racket
Millions of dollars being made in the illegal diesel trade are being used to finance illegal drugs and guns. Energy Minister Kevin Ramnarine said because of the crackdown initiated by the Partnership Government on a racket that has been operating since the 1980s, the crooks are now shifting their base to new areas in the country.
Ramnarine, who gives an account of his stewardship so far, said although raids have put some of the operators out of business and in the courts, there is still more to be done to run them completely out of business.
Q: Before getting to the meat of this interview, can you give us a little of your background as most people did not know you until your ministerial appointment two years ago?
A: You are the first journalist to ask that question (smiles). I am from Cumuto, where my family still resides. I attended Guaico Presbyterian School in Sangre Grande, seven glorious years at Hillview College and then the University of the West Indies where I did Chemistry Masters in Petroleum Engineering, and I have been involved in the energy sector since the late 1990s.
What interested you most about the energy sector?
The interesting thing about the sector is that I started off as a student having been encouraged to get into it, and I was exposed to some very good lecturers at UWI. This is an industry with a glorious history, and I have worked on the preservation of this history with several people, including the late Louis Homer.
What kind of a year would you describe the sector as in 2013?
Clevon, 2013 was a critical year for this sector. We had the largest series of maintenance intervention in the history of T&T. And for the last three years, BP has been conducting intense maintenance of its platforms that came out of the experience they had in the Gulf of Mexico, where there was the biggest oil spill in the industry.
Is it your belief, Senator Ramnarine, that our current spills were perhaps because Petrotrin does not have such a programme?
What I can tell you, Clevon, and I am not being political here, I am being factual, and I have photo evidence of this. For the first decade of this century, the Malcolm Jones administration at Petrotrin did little or nothing to maintain Trinmar. It was left to this administration to begin to invest money in maintenance at Trinmar and this company is a very old asset which has been around since the 1950s, and the PP administration has made it a point to increase oil production.
While Trinmar was being starved and run down, the Jones administration was pumping money and other resources in two projects—one of them which was a multi-billion-dollar failure, the other which ended up being 2.5 times more expensive than originally thought and which has saddled Petrotrin with heavy debts.
Are you saying Petrotrin did not pay sufficient attention to maintenance?
I will categorically say that they paid little or no attention to Trinmar, and in the refinery, this is something which must be scheduled on a regular basis, you know.
I recall you were asked earlier this week whether you thought the spills were acts of sabotage…have you reached any definitive conclusions as yet?
What I would say at this point is we have taken samples from various wells at Trinmar and sent them to international labs for testing, and eventually the finger-print analysis will tell us what was the source of those spills.
How long would this take?
Probably a week or two. What has happened, and I don’t know if you know this, is that over the weekend there was another spill, this time in Moruga. I got a very frantic call from the parliamentary representative for the constituency Mr De Coteau on Christmas Day, alerting me to a spill in Rock River, that has since been contained and dealt with.
This is another...and I find it to be very suspicious that we are having all these spills at this time. So therefore one cannot definitively say it was sabotage until one is in possession of all the facts. Being someone with an engineering background, I will not want to make any conclusions until I have all the scientific facts before me.
Looking through your oil crystal ball (laughs), how are you moving forward in this regard?
OK. The Government has mandated Petrotrin to increase its oil production and currently the company produces about 45,000 bpd, that is a significant amount of oil. It is more than half what the country produces, and to increase production we are very aware that the storage and transmission systems have to be upgraded, so Petrotrin is in the process of putting down a new pipeline to bring oil out of the South West Soledado field, which is producing way below its maximum potential.
In fact, we all agree that Trinmar on a whole is way below its potential, which is now doing around 22,-23,000 bpd.
Why is Trinmar not bringing out more black gold?
The oil is there, and I heard former energy minister Conrad Enill saying on television a few days ago the PNM’s policy was to focus on gas and not on oil, and that this (Ramnarine) minister’s policy is to focus on oil. And we are now producing eight times more natural gas than oil. This is a gas-based economy and whatever you may think about it, natural gas has brought with it a high degree of prosperity to T&T.
My analysis, however, tells me that of all the revenue we collect from the energy sector, about 50 per cent is from oil production and the other 50 per cent is from gas. What we have accomplished this year is that this is the first year that oil production has not fallen. Oil production has been falling like a stone since 2006, and this is first year you will see a flattening of the curve.
Next year we intend to turn that upwards, but to accomplish that the infrastructure which is old must be upgraded because oil has to be piped and the pipelines have to be upgraded, it has to be stored properly and so on, and all this is part of which we call the Soledado South West Reactivation Project which is ongoing right now.
Senator, on this sordid question of the stealing of diesel in a small country like T&T, it seems so inexplicable.
Let me show you something...I want people to think very carefully about the raids that have been happening over the last two years and ask themselves the question very seriously, why wasn’t this happening before this Government came into office? You only began to hear about people being raided in Sea Lots, Claxton Bay, Matura, and so on.
When I became minister my public servants came to me with information and presented. When I saw the information, it became very clear to me that there was a massive racket around diesel. You know the interesting thing about being a minister is that sometimes the answers are with your public servants because they have been around longer than you, so you have to respect them.
How and when did you begin to receive information to go after this racket?
I cannot identify the source, but a very senior officer (now retired) came to me and said this has been going on since 1980. He told me that it was because the price of diesel in Trinidad is being subsided against the price for this commodity up the islands that the differential creates the opportunity for the illegal trade.
Did he tell you why nothing was done since the inception of the racket?
I think there was a total lack of will by people in high office.
Yes, to do anything about it...But there is a very interesting graph (which he brought and which shows the extent of the racket and how the PP regime worked towards reducing the illegal trade)...What we have done in the last five months, we have three raids and people were arrested. They may have been only the guys who were transporting the diesel, and we don’t know to what extent they are the kingpins.
I had the ministry and NP do a little exercise...of the three raids, please tell me what was the value of what was being illegally exported? They told me that based on the tanks that they seized and other assumptions, the value of the three raids was $100 million a year.
What does that tell you, Sir?
Which is if somebody has a business with that turnover annually, that is big business. There are big businessmen in this country who do not make that kind of money in one year; so where is that money going? And what is it being used for? (A grave expression) The information that I have from the police is that the diesel is being used as legal tender for the purchase of guns and drugs, right? And if you look at where the pipe was laid..where the hose was running…it was from Sea Lots under water, to the Caricom Jetty.
Now we are talking about a complex operation, we are not talking about something which can be done by simple people. And furthermore, I am told that we have made a big dent in the trade (still referring to the graph).
Even though we have put some of them out of business, we have not annihilated them, we have not landed the knock out punch. I have been working very close with the Minister of National Security on this whole diesel racket and as result, we are told people are now shifting their operations away from Sea Lots because of the heat being put on them by the authorities.
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