Questions raised over refinery deal


Tribune Staff Reporter

AHEAD of an anticipated signing of a heads of agreement today, the Progressive Liberal Party is raising questions about Oban Energies, the company involved in a proposed $4.5bn oil refinery project for Grand Bahama, asking if the developers have their funding in place.

Stakeholders in the company have been pitching their business to successive administrations for years.

Under the last Ingraham administration, despite an approval in principle between the company and that administration, the project stalled because the administration was not satisfied it had sufficient evidence of the company’s funding.

In an interview with The Tribune last year, Peter Kreiger, the managing director of Oban Energies, said its previous efforts were derailed by the global downturn about a decade ago.

Nonetheless, PLP Leader Philip “Brave” Davis said yesterday its failure to progress under his predecessors caused concern in the Christie administration. 

In a video he posted to YouTube on the weekend, PLP Chairman Fred Mitchell elaborated on concerns the former administration had about the proposal.

“. . . We knew about the proposal and had some concerns about the proposal, about whether or not there’s any market demand for this, secondly whether the people who are involved in this actually have the funding or financing for this because they may in fact be shopping the project around,” the former minister of foreign affairs said.

“Having said that we want any project to succeed in Grand Bahama because God knows the situation is so dire in Grand Bahama. The FNM’s own supporters are saying this is the worst it’s ever been in the history of Freeport under this FNM government. So now they are desperate to get something done, we hope the project is real, we want the jobs, but we don’t want a situation where you have a project that is not going to come off the ground and is really just being used to get permission from the government so they can go shopping around the project.

“We will be watching it very carefully to see whether it’s real and we won’t do what the FNM did and try to sabotage it, we will try to give critical support so that a real project come off the ground.”

Former PLP Chairman Bradley Roberts, in a statement, questioned how the project can produce 600 “direct jobs” as Prime Minister Dr Hubert Minnis announced in the House of Assembly last week.

He said: “Buckeye (the owner of the former BORCO) located in the Lewis Yard and Pinder’s Point areas has a storage capacity of 26 million barrels and can berth up to eight vessels. I am further advised that Buckeye receives, stores, tests and distributes fuel oil, diesel, jet fuel and gasoline. Buckeye also performs inline fuel blending services to meet customer specifications, provides laboratory services, third party storage and can facilitate transshipment operations between super tankers. It is the largest fuel storage terminal on the island of Grand Bahama and one of the largest fuel storage facilities in the Caribbean. “This facility employs a mere 160 persons, including non-Bahamian staff.

Statoil (the former Burma Oil storage facility) located in East Grand Bahama has a capacity of seven million barrels used primarily for the storage of crude oil but employs a mere 60 persons.

“Given the above data, I am obliged to ask the Prime Minister Minnis to explain to the public how and why a four million barrels storage facility utilising the latest in state of the art equipment and industry technology would need to employ 600 persons when Buckeye terminal that is seven times larger at 28 million barrels in storage capacity employs only 160 persons? The numbers simply do not add up but if the prime minister has access to additional information that the general public is not privy to, he is more than welcome to share the same with the Bahamian people.

“I go further. If Buckeye cannot see the economic feasibility in recommissioning the oil refining component of their facility, what business opportunities exist to justify the construction of another oil refinery? Buckeye’s Crude Distillation Units (CDU) and associated support Utilities Department were both mothballed and significantly downsized for economic reasons. The global petroleum market simply could not support the continued viability of those two departments. Again, PM Minnis must have some information he is holding close to his chest and I invite him to share this information in the public interest,” Mr Roberts said.