Oando’s Triumph: Securing the Guaracara Refinery Lease in Trinidad and Tobago
Oando Plc, a prominent Nigerian energy company, has emerged victorious in the bid for the lease of the Guaracara Refinery in Trinidad and Tobago. This significant achievement underscores Oando’s growing influence in the global energy landscape and its commitment to strategic expansion. The selection process, overseen by the Trinidadian government, involved rigorous evaluation of several competing bids, including those from Trinidad’s CRO Consortium and INCA Energy, an American company. Ultimately, Oando’s robust financial standing and proven track record in the energy sector tipped the scales in its favor. The company’s successful $1.5 billion acquisition of ConocoPhillips’ assets in Nigeria in 2014 served as a testament to its financial capabilities and operational expertise, playing a crucial role in securing the lease.
The decision to award the lease to Oando was announced by Trinidad and Tobago’s Minister of Energy, Stuart Young, following extensive deliberations within the Cabinet. Young emphasized the thoroughness of the evaluation process, highlighting the "robust conversations and interrogations" that took place before arriving at the final decision. The government’s careful consideration reflects the importance of the Guaracara Refinery to the nation’s energy security and economic stability. The refinery’s reactivation is expected to boost domestic fuel production and reduce the country’s reliance on imports, contributing to greater energy independence.
The backdrop to this decision lies in the declining fortunes of Petrotrin, Trinidad and Tobago’s state-owned energy company. Minister Young lamented the substantial losses incurred by Petrotrin, which escalated from $361.5 million in 2014 to a staggering $1.2 billion by 2016. This period coincided with a sharp decline in domestic oil production, plummeting from 144,000 barrels per day in 2005 to a mere 78,000 barrels by 2015. These alarming figures underscore the urgency of revitalizing the country’s refining capacity and bolstering its energy sector performance. The lease of the Guaracara Refinery to Oando represents a strategic move to address these challenges and pave the way for a more sustainable energy future.
The official announcement of Oando’s selection was made through a post on the Office of the Prime Minister’s Facebook page. The post detailed the establishment of an Evaluation Committee comprised of industry professionals to assess the proposals received for the refinery’s operation. Following a comprehensive review, three companies were shortlisted, with Oando emerging as the preferred bidder based on the committee’s recommendation. This transparent selection process underscores the government’s commitment to fairness and due diligence in managing its national assets. The government’s emphasis on protecting Paria Fuel Trading Company Limited’s assets and ensuring a stable domestic fuel supply throughout the refinery restart process further highlights its commitment to safeguarding national interests.
This latest achievement for Oando follows closely on the heels of its successful acquisition of the operatorship of Block KON 13 in Angola’s Onshore Kwanza Basin. Securing this operatorship, through a competitive bidding process organized by the Angolan National Agency for Petroleum, Gas, and Biofuels, further demonstrates Oando’s proactive approach to expanding its footprint across the African energy landscape. Block KON 13, located in the prolific Kwanza Onshore Basin, holds significant exploration potential, with estimated prospective resources ranging from 770 to 1,100 million barrels of oil. This acquisition represents a significant addition to Oando’s portfolio and reinforces its commitment to exploration and production activities.
The acquisition of Block KON 13 and the Guaracara Refinery lease are significant milestones in Oando’s growth trajectory. These achievements build upon the company’s recent acquisition of NAOC Ltd in Nigeria, further solidifying its position as a major player in the African energy sector. Oando’s strategic focus on expansion and its commitment to operational excellence position it well for continued success in the dynamic and evolving energy industry. The company’s ability to secure these high-profile assets underscores its financial strength, technical capabilities, and strategic vision, setting the stage for further growth and contributions to the energy sector both regionally and globally. These acquisitions also diversify Oando’s operations, mitigating risks associated with relying solely on a single market and expanding its reach across the energy value chain.
