FORMER National Petroleum Chairman Neil Gosine has said the government’s plan to sell NP’s valuable assets is a poorly designed plan and the plan to liberalize fuels is inappropriate.
He said the combination of the sale of the company’s largest asset base and the liberalization of the fuel industry would have a ripple effect on the cost of transporting goods and services, which could lead to inflation.
He anticipates that the privatization of company-owned sites will open up opportunities for cartel formation on the retail side of the company.
“After Finance Minister Colm Imbert and Energy Minister Stuart Young are done with NP, the entity as we know it will be decimated, leaving all employees, businesses dependent, and thousands of people who depend on it. of its operations in danger, without a future and most definitely on the bread line.
“He will be left in a worse state than what Petrotrin is in now,” Gosein said from a United States National Congress (UNC) virtual reporting platform on Monday evening.
“The business model of the National Petroleum Marketing Company is no longer distributing fuel, this may be a misconception of the new Minister of Energy. It is in fact the franchise agreements with the oil traders that form the lasting part of NP’s business and what earns NP money in its current market. “
He said gas station management accounts for 70 percent of NP’s business.
“There are 113 stations, 75 of which are owned by the company. The dealers own the rest. The estimated value of NP-owned gas stations is around $ 1 billion, each costing around $ 5 to $ 15 million, depending on the volumes of fuel sold at each station and its location.
He said NP gas stations are in prime locations and questioned the wisdom of giving private interests huge state assets when prices are at their lowest.
The privatization of gas stations and the sale of its assets put the company and its future in jeopardy, he said, without any thought for the employees and their families or the businesses that depend on NP’s operations. He pointed out the actual franchise agreements, which include the rent and the management of gas stations and the money coming from that aspect of the business.
Many gas stations offer rental spaces for lotto machines, convenience stores, and food stores.
“So the government’s new idea of raising money by selling the prize assets of NP, which are its main properties, with gas stations around the Twin Islands, is to say the least an ill-conceived ploy.”
On the proposal to liberalize the fuel industry, Gosine said, with the shutdown of Petrotrin, refineries around the world are refusing to offer Paria Fuel, which has become the fuel purchasing company, competitive credit facilities. because it is a relatively new company and has no experience in the market.
“This has put our ability to buy fuel at a disadvantage as Paria now has to buy from traders who will sometimes have fuel and are looking for the best prices to sell their products.
“This means much higher prices at the pump once fuel liberalization is implemented by the Minister of Finance.
“Liberalization may indeed be another form of taxation to be imposed on the already overwhelmed taxpayer and there is no way to protect the public from excessive prices at the pump and a cartel deal of gas station dealers,” he said. Gosine warned.
He suggested that a more viable option would be to put the business on the local stock market and allow every citizen to own a portion of NP, with stakes in the business.
“It’s part of our legacy and our energy legacy and a business that has been profitable in the past and can be profitable again, under the right direction. “