The Chief Executive Officer of Rubis Caribbean Mauricio Nicholls has voiced strong objection to Government’s planned sale of the island’s lone oil terminal to one of his company’s competitors, warning that it stood to not only affect its own business, but domestic fuel prices as a whole.
Wednesday, the state-run Barbados National Oil Company Limited (BNOCL) confirmed that an agreement had been reached with the Sir Kyffin Simpson-led SOL Group for the sale of its subsidiary, the Barbados National Terminal Company Limited (BNTCL).
However, in a brief statement released Thursday afternoon, Nicholls expressed concern over what he termed the “creation of a private monopoly that would control all storage and importation of fuels in the country”.
He said Rubis had already raised objection with the Fair Trading Commission (FTC), as well as with the Ministry of Energy, although no response had been received from either Government entity to date.
“Rubis expects the FTC to conduct a full and detailed review of the transaction and that the FTC will object to it due to the effects it would have on the competition and the significant impact it could have on fuel prices,” the Rubis CEO.
However, in a media release Wednesday BNOCL pointed out that the sale, which is expected to be completed before the end of March this year, would be subject to regulatory approval.
At the same time BNOCL sought to assure Barbadians that it would continue to be the sole importer, owner and distributor of gasoline, diesel and fuel oil on the island.
“Consumers will continue to access product at their regular sources as before. Prices at the pumps will only change in accordance with the price of imported products as is currently done,” the BNOCL statement said.
Government first announced plans in 2014 to sell the BNTCL, which was valued at more than $70 million at the time.
However, very little was said publicly on the matter until January last year when Central Bank Governor Dr DeLisle Worrell called for the sale of BNTCL, while suggesting that Government’s achievement of its 2015/2016 deficit target of four per cent of GDP, depended on it.
Three months later, Minister of Finance Chris Sinckler announced that the sale was definitely on. In fact, he reported at the time that Government was simply “waiting on the cheque”.
However, by July, the FTC said that it intended to look into the proposed oil deal, since it had the potential to put the private buyer in a dominant market position.
“We are doing the initial investigation on the matter, but we realize that negotiations are still ongoing at this stage,” the FTC’s Chief Executive Officer Sandra Sealy told Barbados TODAY last July.