Petrotrin will no longer be the ’sweetbread company’ as it was referred to in the past.
’We have to face reality and this sweetbread image has to change and we have to face the realities and challenges now facing the company,’ said company president Kenneth Allum.
The company will record a loss at the end of fiscal 2009, he added.
In his address to members of the South Trinidad Chamber of Industry and Commerce yesterday, Allum said: ’We have got to become more competitive. We are an export refinery and have to produce competitive products for the international market.’
He said if the company was unable to do this, it could be inching itself out of the market.
’And we have to look at all aspects of our costs and take whatever action is necessary to bring costs down,’ said Allum, who was the feature speaker at the function at Cara Suites, Claxton Bay.
Allum said a major area of concern was in manpower.
’We are low down in international rating and we need to look at our manpower costs very seriously.’
Petrotrin has a staff of more than 4,000, and last week paid the final tranche in a $240 million profit sharing agreement.
But even in the face of this Allum did not say that the company will downsize its operations.
’We have to look at our cost structure at all levels and improve our operations.’
He said one way of doing this is to increase production and ’we also intend to look at both oil and gas production so that our cost would become more competitive’.
Allum said he expects a small loss for the fiscal year ending August 2009.
’September was not a good month and so we expect a small loss,’ he said.
Allum indicated that the company will now have to focus on expansion projects in exploration and production in the future.
He said: ’The margin of profit in refining is down from US$8 to US$4 per barrel and we do not anticipate any improvement in that area.
’If we are to survive we will have to do things differently and face the realities of the market.’
He said for the future the company intends to continue its operations in oil and gas and look critically at the lease operators programme as well as the farm outs to increase productivity.
As far as Trinmar is concerned Allum said it has not been developed to the fullest.
’Finding available funding for such projects is not easy but we are looking at other options,’ he said.
Speaking about cost overruns and delays experienced in the refinery upgrade programme Allum said: ’It is true that the cost of the upgrade increased from US$350 million to US$1.3 billion.’
He explained that the cost overrun was cause because ’we should have scoped the projects before we got into them’.
