Heritage Petroleum Company Limited has resumed oil sales and exports.
In a press release issued this afternoon, the company stated that 550,000 barrels of crude oil were sold on June 19th. This was the company's first sale since April 30th, since a decision was taken to store rather than sell its crude since prices were at a record low.
The following is a press release from Heritage Petroleum:
Heritage Petroleum Company Limited (Heritage) is pleased to report that oil exports have been resumed with the sale and export of 550,000 barrels of crude on June 19th 2020. This was the company's first cargo sale since April 30th 2020.
During the two (2) month interval, the decision was made to store rather than sell its crude, since crude prices were at record lows. This steep decline in oil prices, which forecasted a fall to as low as US$13 a barrel for Brent, was a consequence of a glut in the international market as a result of several global factors including the slowdown of economic activity due to the COVID-19 Pandemic and the 'oil price war' between Saudi Arabia and Russia.
While the company delivered strong performance during the first two quarters of fiscal 2019/2020, the rapid decline in prices during the third quarter was challenging and required swift, robust but prudent action.
Consequently, Heritage Petroleum optimised the use of all 1.8 million barrels of tank storage available in Pointe-a-Pierre and Point Fortin until the crude prices recovered sufficiently.
As governments around the world continue to ease restrictions on non-essential travel and trade, and with demand for petroleum products beginning to recover, Brent is now trading at approximately $US42 per barrel.
As a result, Heritage has benefited from this decision to store and to resume its sale of crude at much more favorable price and market conditions. Because of this storage strategy, which allowed for the deferral of the sale of the crude cargo to June, Heritage has earned approximately TT$88 million over and above what it would have received for just one cargo of crude if this had been sold at April/May Brent prices.
Last week's sale and the successful implementation of the storage strategy was no small feat and was the culmination of the support and cooperation of its employees, contractors and the wider Trinidad Petroleum Holdings Limited (TPHL) Group. While it is expected that it will take some time for the global oil industry to fully recover from these unprecedented times, Heritage continues to closely monitor the markets and work to ensure that the value gained from the export and sale of the country's crude is fully maximized..
Heritage Petroleum is committed to fulfilling its mandate and being a source of pride for Trinidad and Tobago by focusing on profitability, operational excellence and being a performance driven oil and gas company.