The fate of the Barbados National Terminal Company Ltd (BNTCL) appears to be dangling in wind, with Government noticeable silent in the aftermath of the Fair Trading Commission’s (FTC) ruling on the proposed sale to the Kyffin Simpson-led Sol group.
When contacted this morning for comment on the matter, Minister in the Office of the Prime Minister with responsibility for energy Senator Darcy Boyce issued a very terse remark.
“When we wish to say something we will say something. If and when we wish to say something we would issues a formal statement on it. At this stage I am not saying anything on it,” Boyce told Barbados TODAY in the wake of last week’s FTC ruling that the deal could only go ahead if certain conditions were met.
These include a stipulation that there could be no 15-year moratorium on the construction of new terminal facilities. The regulatory body also rejected Sol’s call for a 32 per cent pre-sale increase in throughput fees at the Fairy Valley storage site, on the basis that it could impinge on the provisions of the Fair Competition Act, which prohibits post-merger increases in prices.
With the controversial deal, there were also concerns that costs would likely be passed onto consumers and that Sol could end up with an energy monopoly.
However, Sol is insisting that the deal is still in the best interest of Barbados.
“Sol is a Barbadian company, first and foremost, and this very modest increase [32 per cent increase in throughput fees] would help us run a state-of-the-art facility, and the proceeds stemming from the sale would help the government fund other much-needed projects and programmes,” the company’s
Regional Manager Roger Bryan said in a statement issued last Friday.
He also said the sum offered for the purchase of BNTCL would inject some well-needed foreign exchange into the Barbados economy, at a time where the Barbados economy desperately needs the boost.
The Freundel Stuart administration has been banking on the sale to boost the island’s free falling foreign reserves, which fell below $600 million at the end of September, well below the 12-week benchmark recommended by the Central Bank of Barbados.
It was only last month that Minister of Finance Chris Sinckler told annual conference of the Institute of Chartered Accountants of Barbados that the expeditious conclusion of these BNTCL sale and the proposed sale of the Hilton Hotel would give the country the breathing space it needed to address the medium and longer-term challenges with foreign exchange earnings and retention for the island as a whole.
However, both deals are yet to be formalized and serious doubt currently being expressed over whether Sol would still be willing to pay the US$100 million asking price.