PETROTRIN president Khalid Hassanali, yesterday partially blamed a recent union shutdown of the State oil firm for $600 million in losses and a drop in the company’s net profits for this fiscal year to under $2 billion, compared to last year’s net profits of $2.5 billion.
He gave the figures at yesterday’s annual long-service Employee Ceremony at the Hyatt Regency Hotel, Port-of-Spain.
Asked of the firm’s losses during recent strike action, Hassanali said, “It is calculated on a daily basis, about TT$100 million per day, in terms of loss of gross revenue. The refinery probably didn’t produce for about six days, so that’s $600 million in (lost) gross revenue.”
He said these losses hurt the company, employees and country. The loss in net profit for each day of $100 million lost, is $500 million, he explained. Hassanali said Petrotrin’s net income after tax last year was $2.5 billion, but this year would be less than $2 billion.
“Our gross earnings are about $40 billion, and of the $40 billion last year we earned about $2.5 billion in net income.” He explained why the drop in net profit is a concern to him.
“The gas to liquid (GTL) plant is a failed investment of $2.5 billion, and we have loans to pay in that regard. That’s why, for example, we didn’t have any variable pay in 2009, because we had to write-off that loss and that’s the accounting standings,” he recalled.
“Because of the magnitude of our loan, I can tell you that interest expenses alone are $1 billion a year, just interest alone on our loans. So we are very, very heavily leveraged.”
He said to move forward, Petrotrin needs teamwork amongst management, workers and unions.
“I’m always optimistic that we’d have that.”
Hassanali lamented the fallout of work stoppages. Urging staff to adhere to agreed grievance procedures, he said most workers were back on the job, even as the dispute now heads to the Industrial Court.
“Things are reasonably calm and both the union and ourselves have to keep working with each other to keep things moving along.”
Yet he was optimistic about the future, predicting next fiscal year would be better than this year.
“From October, our fiscal year is going to be a better year because of all the unprecedented levels of exploration and development they are doing. I believe eventually we’ll get the cooperation of all concerned, our stakeholders”. Hassanali said now was an exciting time for Petrotrin.
“Offshore we have for the first time the biggest drilling programme we’ve ever had. We have a rig offshore in Point Fortin drilling, and two ‘work over’ rigs. That’s a major set of activities. It’s a lot of exploration.”
