Petrotrin to cut staff, loses $200m
PORT SPAIN
Trinidad & Tobago Express
Petroleumworldtt.com
12 31 08
Blaming the dramatic plunge in global crude oil prices from a record US$147.21 average on July 11 to around US$39 per barrel at present, Petrotrin executive chairman Malcolm Jones said yesterday that the company will have some very serious decisions to make when the New Year begins tomorrow since it must cut its operating costs or face .
"We are facing some hard times. In fact, very soon we are going to be talking to our partners, you know, the union, telling them what the facts are. We have to talk to them," Jones said in an interview with the Express yesterday.
When asked, however, if this means job cuts could be in the offing for Petrotrin in 2009, Jones quickly responded, "I don't want to get there at all. I don't want to get there but let's put it this way, we have to cut our operating costs, however we do it."
The Oilfields Workers Trade Union (OWTU) represents the majority of Petrotrin's workers and has traditionally provided strong resistance to any moves by management that it believes could affect the well-being of its members.
"They have to face reality. Do you want the company to die suddenly? Do you want to wait until the point of no return? You have to start to take action early," Jones said.
He spoke with the Express after attending a signing ceremony for a Production Sharing Contract (PSC) for the exploration of oil and gas in the Block North Coast Marine Area (NCMA) signed between the Government and a joint venture between Petrotrin and OMEL Energy T&T Ltd. -See Page 10
While the PSC signing was certainly good news for Petrotrin, Jones made it clear that it is not enough to ensure Petrotrin's survival at a time when global crude oil prices are struggling to break above yesterday's US$39 per barrel average.
"The unfortunate thing would be that last year we made over $2 billion profit. So you're going to go from $2 billion profit to a big loss, a fantastic loss in one year? That's how very volatile the market is and how sensitive, how exposed we are to the market conditions but we have to cut our costs," Jones said.
He said Petrotrin needs to cut its operating costs by "much more than" 10 per cent and must cut them "drastically if we want to survive".
Jones said that in the last couple of months Petrotrin "has not done well at all".
"For the last two months, I don't want to say too much but its high. It's high. Very, very high...Two, three hundred million dollars easy," Jones said.
Most of the crude oil used by the company's refinery is imported from other countries at global market prices.
Story by Juhel Browne from Trinidad & Tobago
Express
-jbrowne@trinidadexpress.com
Trinidad & Tobago Express
Wednesday, December 31st 2008
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