Oando PLC Selected as Preferred Bidder for Trinidad and Tobago’s…

Oando PLC has been named the preferred bidder for Trinidad and Tobago’s Guaracara Refinery, based on its strong financial performance and a pivotal acquisition in Nigeria. The refinery has been inactive since 2018, and its revival relies on securing competitive crude imports and effective management. The government aims to restore operations and lessen financial strain through this partnership.

Oando PLC, a leading Nigerian oil company, has been chosen as the preferred bidder for the Guaracara Refinery in Trinidad and Tobago, which has a capacity of 165,000 barrels per day. This decision stems from Oando’s solid financial history, notably its recent $1.5 billion acquisition of ConocoPhillips’ assets in Nigeria. The refinery has been inactive since its closure in late 2018 due to major financial losses, prompting the government to seek a capable operator for its revival.

Trinidad and Tobago’s Acting Prime Minister, Stuart Young, emphasized that Oando’s strong financial track record and ability to secure substantial financing in the upstream oil sector provided it with a competitive advantage over other bidders. He pointed to Oando’s significant acquisition in Nigeria as a testament to their financial strength, making them an appealing candidate to lead the refinery’s operations.

Previously part of the state-owned Petrotrin, the Guaracara Refinery has remained dormant since its 2018 closure. Currently managed by Guaracara Refining Company, a subsidiary of Trinidad Petroleum Holdings Limited (TPHL), the refinery was kept in “preservation mode” pending a search for investors to restart its operations. In 2023, the government announced the need for an operator and solicited multiple expressions of interest from potential bidders.

A government official noted that reviving the refinery is contingent upon securing agreements for competitively priced imported crude oil, ensuring profitable operations. Furthermore, the selected operator must show sufficient financial capability and expertise in asset management, as highlighted by the acting prime minister.

During a national budget presentation, Finance Minister Colm Imbert had previously revealed that Oando PLC was among three finalists selected to acquire the state-run Petrotrin refinery. Initial proposals had included various domestic and international firms, with Oando emerging as a key contender.

In confirming Oando’s status as the preferred bidder, Minister Young underscored the extensive deliberation undertaken by the Cabinet. The Guaracara Refinery is to operate under a lease-type commercial model, allowing Oando to manage the facility as a partner with the state-owned Paria Fuel Trading Company.

Young stressed the thoroughness of discussions regarding the refinery’s future, noting that Oando’s proposal aligns with governmental goals to mitigate the state’s financial strain while maintaining operational flexibility. The government remains committed to prioritizing the reactivation of the facility.

In summary, Oando PLC’s selection as the preferred bidder for Trinidad and Tobago’s Guaracara Refinery marks a significant development in the nation’s oil sector. The decision stems from Oando’s strong financial history and capability to revive the inactive facility. The partnership is expected to reduce state financial burdens while ensuring a practical operational structure, prioritizing revitalization efforts for the refinery.

Original Source: africa.businessinsider.com