By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

Fuel hedging will likely be a key obligation imposed on the Bahamas Electricity Corporation’s (BEC) new private sector manager, its current executive chairman yesterday saying declining global oil prices meant it was the “perfect time” to secure a three to five-year supply contract.

Addressing the Bahamas Energy Security Forum, organised by the Bahamas Chamber of Commerce and Employers Confederation (BCCEC), Leslie Miller said: “I believe that whoever the group is that Cabinet chooses, hedging will be an integral part of that.

“We have tried over the last few years to get new contracts that would save BEC 20-25 per cent on our fuel costs. The price of fuel has gone down significantly. The time is now to go out there and get a three to five-year contract.”

Deputy Prime Minister Philip Davis said yesterday that the Gsovernment expects to announce the identity of the BEC management company within the next two weeks, with three contenders left in the process.

He added that the Government had moved away from plans to break BEC into two entities, and was moving forward with a business model to basically mirror that which the Nassau Airport Development Company (NAD) has for the management of the Lynden Pindling International Airport (LPIA).

Like that airport deal, Mr Davis said the Government will retain 100 per cent ownership of BEC.

Mr Miller said yesterday that despite declining global oil prices, BEC has not seen any decrease in its fuel costs due to the significant debt owed to its supplier, Shell Western.

Mr Miller said: “We believe that for the next 18 months the cost of oil will continue to drop, which is a benefit to the consumer.

“However, BEC has not seen any appreciable decrease in our price. When you owe Shell West $148 million, they are charging you interest on your balance and they say if you want to go out and get competitive prices, pay us our money.

“Well, BEC can’t write a cheque for $147 million. Bahamians are caged and can’t get out of that deal. If we could get a hedging that would save us as much as 25-30 per cent on our fuel cost, hedge for about three years and get it done. Time is of the essence. Time is money. Every day that goes by our situation gets worse.”