Petrotrin, Trinidad Petroleum Holdings Limited

Petrotrin was a Trinidad and Tobago state owned oil company . The full name of the company was Petroleum Company Trinidad and Tobago Limited and it was established in 1993 after the merger of Trintoc and Trintopec. It is a state run company with the finance minister and the energy minister acting as the corporation sole and the line ministry that provides specialized technical analyses and statutory approvals for the company’s operations respectively.

The total assets of the oil company was valued to be around 40.5 billion Trinidad and Tobago dollars. Wilfred Espinet is the former chairman of the state owned oil company. Petrotrin reportedly employed a total of around five thousand five hundred workers.


The company was established in 1993 with the merger of 3 companies, the latter company would not become incorporated until 2000. Trintoc was formed in 1974 by using the assets from Shell Trinidad Ltd and the assets from Texaco were also used in 1985. The purchase of the interests of Trinidad Tesoro in 1985 lead to the creation of Trintopec. Trinidad Tesoro was a joint venture between Tesoro Oil and the government of Trinidad. Further-more this company was created to purchase the assets of British Petrolium in 1969.

Trinmar was formed when the government purchased the offshore exploration assets of Trinidad Northern Areas Limited (TNA) which was formed by the then “Big Three”; British Petroleum, Texaco and Shell. These companies were formed from a suite of earlier companies including Trinidad Oilfields Limited (TOL), United British Oilfields of Trinidad (UBOT), Trinidad Leaseholds Limited (TLL), Trinidad Petroleum Development Co (TPD), Apex Trinidad Oilfields (APEX/ATO) and Kern Trinidad Oilfields (KTO), which had themselves been formed to first able commercialize oil finds in Trinidad in the early twentieth century.

Petrotrin operated in land and marine acreage across southern Trinidad. In some instances, the company has engaged in joint ventures, lease operator-ships, farm-outs and incremental production services contracts to support its exploration and production activities. In 2004, Petrotrin was granted an automatic stake in all exploration and production arrangements with foreign companies in Trinidad and Tobago.

In the year of 2018, ninety percent of Petrotrin’s sales to the local market have been fuel – 46% is from gasoline, 37% from diesel, 11% from jet fuel and 5% from liquefied petroleum gas (LPG or cooking gas). Petrotrin exported to the Caricom market with the main countries being Jamaica, Barbados and Guyana.

The Refining work of Petrotrin

During the early nineteen hundreds there were several small refineries operating in Trinidad, including plants in Santa Flora (TPD 1930 – ?) and Brighton (UBOT 1911-1978). These were all closed over time as they became non-viable either because of aging technology or supply and cost challenges. The Point Fortin Refinery built in 1912 that once refined Venezuelan crude was the last to be shut down in 1994 due to cost challenges after the economic recession of the 1980s to make way for Atlantic LNG as Trinidad and Tobago shifted its emphasis from oil to natural gas.

Petrotrin were the operators of Trinidad and Tobago’s single petroleum refinery, located at Pointe-à-Pierre, just north of the city of San Fernando and is popularly known as the Pointe-a-Pierre Refinery. The refinery produced liquid petroleum gases, unleaded motor gasoline, avjet/kerosene, diesel/ heating oil, fuel oil and aviation gasoline among other products. It has driven the country’s economy and placed the country in the hydrocarbon sector.

Former sugar estates in the area were purchased for plans to build a refinery in 1913 by Trinidad Leaseholds Ltd, a British subsidiary of Central Mining Company headquartered in the United Kingdom. In 1917, the refinery was built and began production at 75,000 barrels of oil per day (bpd). Its first upgrade occurred in 1928 with the construction of the No 3 and 4 Topping plants. During World War II the refinery was identified as an asset to be “protected at all cost” as a major supplier of aircraft fuel for the Allied forces.

By the time it was 1940, the refinery went through another expansion, a top secret project known as Project 1234 and by May 1942, the first Catalytic Cracking Unit came on stream where refining capacity in Trinidad and Tobago was recorded at 28.5 million barrels per year. At the end of World War II, the refinery was recognized as the largest in the British empire.

In 1956, Trinidad Leaseholds Ltd was acquired by Texaco where by April 1960, the No 8 Topping Unit came on stream along with a lubricating oil plant, canning plant and a paraffins plant with production increasing and peaking to 360,000 barrels per day by 1970. Following the unrest of the 1970 Black Power Revolution, throughput was down to 183,000 barrels per day yet the refinery continued to be viable. By late 1984, Texaco assets including the refinery was acquired by the State and placed under the state company Trintoc which itself was merged to form Petrotrin in 1993. By 1997, upgrades to infrastructure, instrumentation, and environmental systems were competed.

It was done to improve product quality by reducing the sulfur content and increasing octane moving production from 90,000 to 160,000 barrels per day. More upgrades were done on the plants as recent as 2011. By being the only refinery in operation in the Caribbean, Trinidad & Tobago became the supplier of refined petroleum products to the rest of the region. Petrotrin produced 48,047 barrels per day (7,638.9 m3/d) and had proven reserves totaling 439,585 million barrels (6.98884×1010 m3).The refinery had a capacity of 190 thousand barrels per day (30,000 m3/d) and it was the only refinery in the world that operated alongside a wildlife park.


The closure of the oil company

The state run oil company became the embodiment of poor corporate governance, expressed in bad policy decisions, wastage, corruption and nepotism across governments. The Oilfield Workers’ Trade Union’s power over the company due to consolidation of past state oil companies made it even more difficult for management to institute changes. On 28 August 2018, it was announced by Prime Minister Dr Keith Rowley that Petrotrin would have to be shut down, (although earlier stating in his political campaign they (the present government) would not shut down the state owned company) because of the government AND company’s inability to generate a profit during a period of low oil prices where TT$8 billion was lost over five years.

They government also explained that the lack of competitiveness, declining production, TT$12 billion in debt, and the loss of foreign exchange due to the importation of oil to be used together with locally produced oil to keep the refinery in operation. A cash injection of $25 billion would be required to refresh its infrastructure and repay its debt. On 30 November 2018, Petrotrin was shut down with the country’s largest refinery officially closed after 101 years in operation. Approximately 5,500 permanent and temporary/casual employees lost their jobs.

The company has since been broken up into four new companies as of the first of December 2018. The first of which is Trinidad Petroleum Holding Limited which has an interest in legacy matters such as settling outstanding financial debts by Petrotrin and the parent company of the following three companies. The second company is the Heritage Petroleum Company Limited which has vested interests in exploration, development, production and marketing of crude oil.

The third company is Paria Fuel Trading Company which does trading and marketing of imported fuel products. Lastly the forth company is Guaracara Refining Company and it is a holding company for the Pointe-a-Pierre refinery and related assets to be offered for sale.The refinery flame was a national landmark with many in surrounding communities such as Pointe-a-Pierre, Marabella, Claxton Bay and Gasparillo expressing hopes for the refinery to be purchased and restarted by private enterprise.

The success story before their closure

This was spoken by the late Franklin Khan during his term as energy minister.

Energy Minister Franklin Khan boasted that, under his tenure, the restructuring of Petrotrin became a “success story”. The minister was speaking on a motion of no confidence moved against him by Pointe-a-Pierre MP David Lee at the Parliament sitting yesterday at the Red House in Port of Spain. Khan defended himself and was the first speaker on the Government bench.

Petrotrin was a major loss-making enterprise and if not attended to would have had a “systemic impact” on the economy. He said Petrotrin had a $10 billion debt and also a “bullet payment” of US$850 million which was due in November 2019. Khan said a bullet payment is “come up with the money or walk”. He said at that point Petrotrin was owing the State unpaid royalties and taxes amounting to $3 billion.

“This one takes the cake, staff expenditure at Petrotrin made up 50 per cent of its total operating cost. There is no oil company in the world, and I can tell you without fear of contradiction, where staff salaries made up 50 per cent of its operating costs,” he said. Khan said Petrotrin did not have enough oil to run its refinery operations and it had to import two-thirds of the oil—100,000 barrels a day.

He said on every barrel refined there was a loss of US$5 so in fact the company was importing oil to lose money. The minister said the Petrotrin board came up with the option to focus on exploration and production, close the refinery and put it on the market for a potential buyer or operator. He said Petrotrin was restructured and a holding company was formed with four subsidiaries. “Madam Speaker, I say here today the restructuring of Petrotrin has been a success story and I will go further to say that is probably the understatement of the year,” he said.

He said Heritage Petroleum for its financial year 2019-its first year of operation-achieved a net profit of $1.4 billion. Khan said for the 12 months ending September 2020 it achieved an additional profit of $884 million after tax. He said over that period the company paid $1.2 billion in taxes and royalties to the State- something Petrotrin was not doing. Khan said the locally produced crude was fetching a good price on the international market. He said when Petrotrin was restructured there were views from critics that the crude has no value.

Khan said Government has also managed to bring one of Petrotrin’s former projects to fruition by working alongside a private entity called NiQuan Energy Trinidad Ltd. NiQuan, he said, acquired Petrotrin’s incomplete gas to liquids plant in 2018. He said it has now successfully completed the plant and commenced commercial production. Khan said this is a 4,000 barrel a day ultra low sulphur diesel production facility coming out of natural gas. He said on March 8 he will be officially commissioning the plant

The new search for a buyer for the oil refinery

Port of Spain, Jan 19 2019 – Trinidad and Tobago will return to the open market to seek a buyer for its oil refinery that ceased operations two years ago after rejecting a proposal from a local group, Finance minister Colm Imbert said on Tuesday. Imbert said Patriotic Energies, a subsidiary of a trade union which represents oil workers, could not provide any credible offer of financing for the Petrotrin oil refinery. The government decided to “return to the open market to see if there is anybody else interested in the plant…and explore all options for the utilization of the refinery”, he said.

The government shut down the state-run Petrotrin and ceased operations two years ago at its only refinery, which then had the capacity to process about 140,000 barrels per day of crude, to curtail losses of over $1 billion in the previous five years. The government said Petrotrin required a cash injection of $4 billion to remain in operation, upgrade its infrastructure and repay the nearly $2 billion in debt it had racked up.

Trinidad government turns down Patriotic’s offers for Petrotrin refinery

The Trinidad Government said it would not be accepting proposals put forward by Patriotic Energies & Technologies Co Ltd (Patriotic) for the sale of the Petrotrin oil refinery. Speaking at a media briefing a few months ago, Finance Minister Colm Imbert said this was because based on the options provided, government would be made to bear the burden of the financing arrangements. Imbert said two options were presented and submitted to Cabinet. He said the first option required government to issue tax credits to Patriotic in the amount of US$750 million.

‘The tax credits would be divisible, meaning that they could be divided into smaller amounts and transferable, such that Patriotic would be able to sell them to a third party.’

‘When government issues the credits, Patriotic would transfer them to Credit Suisse, who would be empowered to sell the credit at US$100 million or US$680 million per year.’


He said they would be able to sell those credits to any third party. ‘The implications of this option is that the revenue of the government would be reduced by $5 billion, because these tax credits can be sold to anyone and essentially would be a gift to Patriotic.’ He said additionally this meant that Patriotic would gain access to the Paria Fuel Trading Company and the Guaracara Refining Company at no cost to Patriotic.

He said Patriotic would be able to own the assets and pledge them or mortgage them for future financing at no risk to them. ‘The greatest risk to government and the country would be the loss by Patriotic of these assets.’ He said the second option involved a ‘receivables purchase agreement between Patriotic and Credit Suisse, whereby the purchaser would agree to buy the assets in the form of receivables from Trinidad Petroleum, the holding company which owns Heritage, Paria, Guaracara’. ‘Petrotrin in essence still exists…in the form of Trinidad Petroleum. In the second financing arrangement a purchasing agreement is required in the form of Trinidad Petroleum for approximately US$500 million. Trinidad Petroleum would then transfer the title to Patriotic upon execution of the agreement.’

Imbert said payment for the assets would be made in accordance with a deferred payment schedule. This is similar to Patriotic and Trinidad Petroleum entering into a hire purchase agreement to purchase the refinery and Paria and Fuel Trading assets, with the government, rather than Patriotic, servicing the financing over time.’ ‘So in option two, a loan of US$500 to US$550 million is arranged by Credit Suisse and the government is required to service the loan.’ ‘This would entail a legal, valid, and binding agreement, enforceable against government [which would be] to make annual budgetary allocations estimated at TT$864 million for seven years to service the obligation. The implications of this [is that] the government will be required to co-sign [act as guarantor] the loan.’

As a result, he said government could not accept either offer. ‘Having examined all of this…Cabinet felt that it could not proceed with this matter and that we would have to revert to the decision that we made previously….that Trinidad Petroleum Holdings [and] government would thank Patriotic Energies and Technologies Company Ltd for its proposals…and inform Patriotic that the exclusivity…could no longer be supported.’

‘Secondly, that Trinidad Petroleum and the government would return to the open market to pursue all other options which may exist for the utilisation of Guaracara, the refinery and assets in the shortest possible timeframe with the main conditionality being to determine whether there are any suitable parties interested in operating the refinery.’ He said Trinidad Petroleum would suggest to Cabinet that in three weeks’ time requests for proposals be submitted for the ‘canvassing of the current market to explore options for utilisation of assets’.

Thanks for reading this article and as always if you found this post to be informative and educational then please follow our blog and while you are at it why not follow our socials for all our latest blog posts. Have a good one!

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s