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

Oando PLC has been chosen as the preferred bidder for the Guaracara Refinery in Trinidad and Tobago, given its strong financial record and notable previous acquisitions. The refinery has been inactive since 2018 due to financial losses. Acting Prime Minister Stuart Young confirmed this decision, emphasizing Oando’s financing capabilities, which ensure competitive operations for the refinery’s potential revival under a lease agreement with the government.

Oando PLC, a prominent Nigerian oil company, has been selected as the preferred bidder to acquire the Guaracara Refinery in Trinidad and Tobago, which has a capacity of 165,000 barrels per day. This decision follows the evaluation of Oando’s sound financial history, particularly highlighted by its successful $1.5 billion acquisition of ConocoPhillips’ assets in Nigeria. The refinery has been non-operational since its closure in late 2018 due to significant financial difficulties.

Trinidad and Tobago’s Acting Prime Minister, Stuart Young, remarked that Oando’s capability to secure substantial financing in the upstream oil sector provided it with a competitive advantage over other bidders. The selection process emphasized Oando’s impressive financial profile and its strategic acquisition that bolstered its appeal for the ownership of the refinery. The Guaracara Refinery, previously part of Petrotrin, has been preserved as the government actively seeks potential investors to revitalize its operations.

In 2023, the Trinidadian government initiated a search for an operator for the refinery, setting a deadline for reviewing multiple offers. The pursuit for interest garnered attention from both domestic and international entities regarding the purchase or lease of the facility. A government official cited by Argus Media noted that the refinery’s reopening is deemed feasible only with agreements for competitively priced imported crude to ensure profitability.

Oando was among three finalists competing for the refinery acquisition as announced in a national budget presentation by Finance Minister, Colm Imbert. In addition to Oando, the shortlisted contenders included the CRO Consortium and INCA Energy, showcasing a diverse range of bids. With Oando affirmed as the preferred bidder, Minister Young emphasized the Cabinet’s careful deliberation over the decision, highlighting the future significance of the refinery’s operations.

The Guaracara Refinery will function under a lease-type commercial arrangement where Oando will lease and manage the facility in collaboration with Paria Fuel Trading Company Ltd. Young confirmed that the proposal aligns with government objectives to alleviate the state’s financial burden, thereby prioritizing the restart of refinery operations for the economic benefit of Trinidad and Tobago.

Oando PLC’s designation as the preferred bidder for the Guaracara Refinery showcases its strong financial standing and strategic business capabilities, particularly through a significant acquisition in Nigeria. The refinery, inactive since 2018, is viewed as a vital asset for Trinidad and Tobago’s energy landscape. The collaborative lease model with the state-owned Paria Fuel Trading Company highlights a promising path forward for revitalizing the facility and ensuring its operational success.

Original Source: africa.businessinsider.com