merger on the cards
Government is pressing ahead with plans to merge the National Petroleum Corporation (NPC) and the Barbados National Oil Company Limited (BNOCL).
The disclosure was made yesterday morning in the House of Assembly by Prime Minister, the Rt.Hon. Freundel Stuart, who said that Government intends to secure a multimillion dollar loan from the Inter-American Development Bank (IDB) to help bring that union to fruition.
He was leading off debate on the National Petroleum Corporation (Amendment) Bill, as he explained that the merger is being “actively pursued” and should become a reality in the not too distant future. The aim of the move, he added, is to improve the operations now performed by the two bodies.
“All of the contours of that determination are being at present explored to ensure that we get it right, but both sides agree that the interests of both entities would be better served by an amalgamation of the two entities,” he said.
Prime Minister Stuart added, “The Cabinet of course addressed that issue and that position is being pursued, and we did all of this of course looking at the unfavourable financial performance of the Corporation; looking at its cash flow difficulties; its inability to vigorously pursue the kind of mains expansion programme that the Government thinks desirable, and of course in so doing, expanding its customer base. We had to take into account its inability to service a debt it owes to the BNOCL, which at present stands at over $11 million, and its inability too, to service, maintain, replace and/or reposition old and unsecured pipeline infrastructure.”
According to the St. Michael South Member of Parliament, “quite a bit” of the natural gas pipeline in this country dates back to the 1940s and 1950s.
He made the point while drawing on the experience of the Barbados Water Authority, noting that the country knows the impact that aged pipeline infrastructure can do to an entity’s capacity to supply its product. With that in mind, he revealed that in respect of the loan from the IDB, the US$34 million will be used to help address the issue of institutional strengthening and capacity building as efforts are made to make the two institutions one and to help facilitate much-needed upgrades to the existing systems.
“It is also supposed to deal with the issue of energy security since the Government is committed to the use of cleaner fuel, and it is intended to make sure that our access to
energy, particularly renewable energy, is sustainable,” he stated.
Prime Minister Stuart indicated that the first disbursement of the loan is scheduled within the next three months, once the conditions have been satisfied. (JRT)