By Raffique Shah
December 05, 2018
During last Friday’s unofficial “Day of Moaning” for the official demise of State-owned oil giant Petrotrin, I detected more than a hint of hypocrisy among the moaners. I must confess that your not-so-humble scribe was prominently positioned amidst the thousands of Trini-Pharisees who had saved their saddest faces and rehearsed their most somber vocal tones for the tragic occasion.
I admit that mine was an ego issue, one in which my wounded pride provoked extreme prejudice against my fellow-Trinis for having shamed me, for having shattered my dreams of seeing us as a people take control of the commanding heights of the economy, and successfully steer them to take their place alongside the best such enterprises in the world.
When we campaigned in the 1970s for Texaco to go, to leave the local oil industry, especially the massive refinery at Pointe-a-Pierre, for native professionals and dedicated and experienced workers to manage and operate them, we thought we could dance like dragons on the global energy stage, show them a thing or three about our prowess in exploring and exploiting our hydrocarbon resources.
We didn’t know then that our politicians would pollute the newly-acquired industries with political implants who did not know the difference between an oil rig and a bunch of cooking figs, As far back as then, because we had one of the oldest commercial oil industries in the world, many of our brightest sons and daughters had studied hydrocarbons at the most prestigious universities and technical schools abroad. Scores of them were scooped up by the oil majors and worked in oilfields and refineries across the world. Some became innovators on the technical side. Others mastered petroleum economics and finance.
But while their services were in demand elsewhere, relatively few found places in the local industry. Over the years, many of them were blacklisted by parties-in-power because they stayed aloof of politics. They saw persons way below their competencies land plum positions while they were relegated to the drudgery and poor pay scales of the public service and academia.
It was politics, too, that turned once-motivated workers into the lazy-syndrome, damaging the work ethic such that those who chose to be productive were ostracised by their colleagues. Politics, and poor management, often indistinguishable from each other, led to neglect of the plants, the equipments and environments they worked in.
The refinery and tank farms rusted-their neglect could be seen by the public. What we could not see was the sad state of offshore drilling platforms and vital pipelines. It was almost as if there was a conspiracy to expose the ineptitude of locals, show that they could not run a large oil company the way “de White man” did.
Meanwhile, benefits, wages and salaries rocketed to levels way out of synch with the national norm, widening income inequality and negatively impacting Petrotrin’s balance sheet. Add to these woes rampant corruption at all levels of the company, from captain to crook, and what we had was a disaster waiting to happen.
So am I angry that the commanding heights of the economy, embodied in Petrotrin (and Caroni Ltd), have crashed to a disastrous end? Damn right I am. All those who brought the once-powerful giant to its knees ought to be made to pay for their sins. But that’s not about to happen. Instead, they more than likely will have been handsomely rewarded with Lotto-like severance or retirement packages.
Taxpayers will foot the multi-billion-dollar bills they’ve left behind–$25 billion or more, some economists estimate.
And you know what makes me angrier? Some foreign company will return, lease the refinery from government, employ persons who will be made to work, really work, for salaries far lower than what Petrotrin paid, and little or no benefits, and they who squandered the national patrimony will rush for the jobs.
It is to out eternal shame that we could create the downstream industrial wonderland that is the Point Lisas Estate, that we were pioneers in the West with Atlantic LNG, but we could not run an oil refinery as a profitable enterprise.
That really hurts me, as surely as it must make men such as the late George Weekes, Joe Young and Ramcharitar “Bull” Lalchan, among the pantheon of unionists and internationalists who fought for us to control our country and its destiny, turn in their graves.
Not just that: but those who sympathised with the richly-compensated architects of Petrotrin’s demise will soon have to pay realistic prices for fuels, either if we continue to import them, or if a new operator takes over the refinery. That’s a simple case of dollars and sense, simple arithmetic. The wealthiest Arab oil-producing countries have removed subsidies, so why not debt-ridden T&T?
The only prerequisite to the implementation of this measure is an efficient public transport system-and I have written extensively on that: bring on bus rapid transit (BRT). It can be phased in, in the busiest corridors, in a few months. But to continue subsidising motor-fuels is fiscal madness.
The wages of the sins of the comparative few who raped and plundered Petrotrin will be an unending, multi-billion-dollar purgatory for generations yet unborn.
I wish I could write “here endeth”. I cannot. I fear our oil and debt woes have only just begun.
12 thoughts on “Day of moaning for Petrotrin”
You are absolutely correct. I hopo Trinis wake up and become more productive and responsible. There is just too much waste in public sector and measure of performance. A recipe for disaster.
Trinidad & Tobago can do better!
This expat gravely fears that T&T is headed to 5th World Status, totally skipping over the 3rd World Status other Failing and Failed States spend some time in.
501 Murders to YTD.
The world was a safer place during the Cold War when there were two superpowers. Now with one superpower .. not so safe. Same as with Petrotrin. Petrotrin was better of when a strong management and a strong OWTU sat at the negotiating table. With continuous political interference and political appointments, management became impotent abdicators, acquiescing readily to the demands of the unions. There now was only one superpower. The OWTU, who sought to dictate to management with authority but accepting absolutely no responsibility. So let’s do a basic root cause analysis:
Q. Why did petrotrin collapse;fail?
A. The demands of the OWTU became untenable.
Q. Why did the OWTU become this super force, a political entity seeking even to dictate demands to the state.
A. (Executive) management and by extension senior management abdicated their responsibilities and morphed into eunuchs.
Q. Why did management become impotent.
A. The shareholder GORTT made all the decisions and used Petrotrin as a cash cow to fund mega projects, political campaigns, social welfare, ‘jobs for the boys’ etc.
Q. Why did the share holder appoint puppet executive managements and then run the company by decree.
A corruption, greed, nepotism, payback to financiers etc.
The government is controlled by a few(1%) locally and multinationals externally.
The population falls for the states demonization of the workers and the OWTU, but these are mere effects. The Root cause is the very same who stand in judgement and use the worker and the OWTU as the villains as an excuse to sell off the assets of petrotrin to .. guess who??
The govt and the major oil company mercenaries have done a good job of demonizing the petrotrin worker even though some worked with dedication and did not received these excessive overtime payments. Non Petrotrin citizens think this decision by the govt will not affect them personally and watch on as jeering spectators as they throw us to the lions at the gladiatorial games.
Yet nothing about the political machinations and directives of the shareholder (GORTT) over the years. OWTU was not the cause it was the effect. .
Must give the shareholder credit for his diabolical plot. Ably aided and abetted by the real folks who pull the puppet’s strings behind the scenes. ..and who stand to gain the most from the spoils of victory.
As Mario Brown said; Trinidadians will start feeling the effects in the coming months and the politicians’ (in power) real agenda will come to light. However too late for the citizenry to change.
Folks let’s be clear the death of Petrotrin was the PNM…
Petrotrin the facts:
2002 -Debts $3 1/4 billion
2010- Debt rose to $12 1/2 billion. (3 failed projects under the PNM)
2012-Profit $1.8 billion. (the last year to make a profit)
2013-2015 Loss $2 billion
2016-Loss $2 billion
2002 Petrotrin debt was $3 1/4 billion, it rose to $12 1/2 billion in 2010.
Petrotrin borrowed by putting out 2 bonds to finance 3 failed projects. They borrowed US $750 million in 2007 and US $850 million in 2009. Those bonds have to be repaid.
Leo Chan analysis of the Petrotrin affair can be put into this logical form: 1.The OWTU became stronger and its demands became untenable. 2. The OWTU became stronger because the management became weaker and impotent. 3. The management became weaker because the government made it into a puppet management there to do the bidding of the government as it used Petrotrin as a cash cow to pay back financiers and enact other corrupt doings. 4. It does this because it is controlled by the local 1% and foreign multinationals. My analysis is different. I agree with 1. That the OWTU became stronger and its demands became untenable, and that is the immediate cause of the Petrotrin refinery debacle. OWTU held the country to ransom because of its perceived strength and made demands for salaries which coupled with low productivity eventually made the Petrotrin refinery financially untenable. They literally killed the goose that layed the golden egg. The reasons why OWTU became stronger goes beyond the problem of weak management, in fact management and union at Petrotrin have a history of confrontational and contentious behavior. This is not indicative of a weak management. Rather the “strength” of OWTU is associated with the political trajectory of the post 1986 defeat of the PNM. The PNM was “shellacked” in 1986 losing 33-3 to the NAR. The politics of the period after that was characterized by close elections and winning depending on a few marginal seats. The OWTU was already associated with the NAR in 1986 with collusion by a few top union members, after that the union fielded the MSJ which eventually allied itself with the PP. With winning in the elections dependent on a few marginal seats the OWTU sensed its political strength. If the OWTU could mobilize the trade unions, it thought it could play a decisive role in elections. It was this that gave them their feeling of strength and at the same time weakened the hand of management who were after all government appointed. OWTU became a political organization, using its perceived mobilizational ability to bargain from a position of strength with any government, UNC (PP) or PNM. In trying to use a political party to acquire bargaining strength, the OWTU was ultimately used by that political party. One remembers the NAR and its introduction of the Washington Consensus and its free market dictums and the UNC (PP) and its anti union positions after they were elected. The OWTU holding the country to ransom worked for a while but then the wages of purely self interested action without a thought for the national community came back to bite them. The lesson coming from this fiasco is – think of the national community, we are all in this together and as the old people say – time is longer than twine.
Credit must be given to the local texaconians left behind in 1985 to run the refinery. These folks were well trained by Texaco and most served with pride and dedication. At first they were a ‘critical mass’ of not only skilled and experienced workers but also ones who had been selected by their employers simply on merit. It’s been over 3 decades, all these workers have either expired or put to pasture. Most were ‘company men’ working through strikes and industrial unrest. They lived, worked and enforced the company rules accused and humiliated of being scabs. They were told it’s not what you deserve it’s what you negotiate. Yes Right!! Their medical plan which IS part of their contract with the company has been stopped without rhythm or reason. And to rub salt in their wounds the sub-lieutenant has the audacity to heap scorn on these folks. He had his brief moment of fame and glory boasting of being able to fire two sten guns at once. Good for him. Much respect. But others stayed in the trenches and soldiered on. Texaco did not leave because of 1970 uprising. They left because the refinery had become uneconomical to run. Globally, there was a downturn. Texaco was able to extract a more than handsome price from the government for their Trinidad assets, because we were conned into thinking we caused ‘TEXACO MUST GO’ Credit also to many others hers who joined the company and kept it running, but the work ethos could not survive the onslaught of political interference and the civil service culture that comes with state ownership. For an eagle to successfully hunt and survive it must focus on one prey and on prey only. State owned Petrotrin had to run as a business while at same time be a social welfare agency of the state. Surely unable to catch either prey. God bless our nation. There are still good people here. The silent majority who are being abused from all sides.
While I understand and empathize with Raffique Shah’s concerns, and in particular with the shattering of the dream of taking over the commanding heights of the economy, I think the issue is larger than just the Petrotrin refinery. I think it draws us back into that debate about the economic consequences of taking over the coming heights of the economy by the state. That debate played out in the late 1980s in T&T when the state was re-conceived as a facilitator of business rather than as an owner of business enterprises. I heard the Jamaican PM, Holness, make the same comment about the state being the facilitator of business at the recently concluded CSME meeting. The counter-revolution against socialism in any of its incarnations and communism took place in the 1980s. Its leading intellectuals were Milton Friedman in the US and Friedrich Hayek in the UK. Its leading politicians were Reagan and Thatcher. The counter-revolution swept the globe, communism fell in the Soviet Union, and free-market economics caught on almost everywhere. In the Caribbean, the IMF was instrumental in enforcing the tenets of liberalization of the economy. The slogans were privatization, trade liberalization and deregulation. State ownership of business enterprises were said to be inefficient, ineffective and badly managed and this was because of the very nature of state ownership. Neoliberals argued that: 1. The private sector was more effective and better managed because its main concern was the bottom line, profit making; 2. The state had to think of other concerns, the social effect of decisions, the democratic requirement of decision making; 3. The state had to go through a maze of bureaucratic red tape and regulations, the private sector could make decisions with speed and efficiency.
The criterion of economic well being for neoliberals was growth. Economics has followed that line. The closure of the Petrotrin refinery has to be seen in that context. To contest it, we would have to engage an entire economic philosophy – essentially that of free market economics and neoliberalism. Such an engagement is in the first place an intellectual one or we would appear to be anachronistic and out of timing.
only thing to save trinidad is to rid the country of the present from pnm and unc government.
We need to go the chinese route-Lets dissolve the constitution and appoint COMMITTEE OF 12 TECHNOCRATS to oversee the development of trinidad .The attorney general has to be elected as an independent.
So he can prosecute anybody from the government involved in illegals.
Pnm and unc politics has evaporated all this country money and left it in debt-this year we have to rid the country of them
I wonder if I’ll ever see good governance in my lifetime, so many disappointments. Sadly, even people I know personally and supported quickly morphed into selfseeking opportunists, once they got into office. I am still hoping and willing to listen if new leaders emerge, but I’m no longer a political virgin, not even a born again one.
PORT OF POINTE A PIERRE
THE WAY FORWARD
The port of Pointe a Pierre was and still is a jewel in the crown. Sheltered, good anchorage away from the usual hurricane paths. It is the near ideal site for an oil tanker terminal. Strategically located as a hub to the Americas.
It is for probably for this reason the refinery is located near this port. In its heyday, as late as the 1970’s, over 700,000 barrels of crude and petroleum products were transferred daily across its jetty pipelines.
The multinational owner at the time, recognized the port’s importance and invested heavily on the construction and maintenance of the terminal facilities as well as the recruiting, training and development of its human resources.
Marine Managers and daylight and shift Marine Superintendents were all internationally trained and qualified marine professionals. In 1966 the first local marine cadets were sent to the United Kingdom for training as marine professionals with the intention of replacing the expats who held senior positions in the port. These internationally trained marine professionals returned and took up senior positions in the port of Pointe a Pierre as well as the newly opened port of Point Lisas. The port of Pointe a Pierre was managed and operated along international standards. Managers, superintendents and supervisors had the respect of both foreign ship officers and crews as well as their weekly and hourly paid terminal employees. This transition to local marine professionals occurred in a phased basis. However, in 1982 with the downturn in the oil business, all locals being trained were returned home and the training program ceased. When the multinational left there were some internationally trained locals to ‘hold the fort’ and maintain international oil tanker and terminal standards. As and when these locals left, there did not exist a ready pool of qualified candidates available locally to replace them. The standards started to diminish so as to allow less qualified locals from within the ranks to ascend to these technical positions. ‘The brandy was being watered down’
Previous to the multinational departure and in parallel with this investment in human capital was an equally important investment in the upgrade and maintenance of the facilities, including the jetties, pipelines and marine crafts. Preventive, predictive and periodic maintenance was routinely scheduled and done. This risk management approach minimized unplanned events and avoided catastrophic failures, injuries and deaths. This too would become a thing of the past, beginning in the early 1980s.
The company became state-owned at a time when it was generally accepted that the business of refining was in the red. This started an over three decades long trend of financial cutbacks, which initially was only intended to be temporary. However, it became the norm that port operations and marine services were relegated to the very end of the financial chain. The port facilities along with marine crafts, pipelines, jetties etc. descended into a culture of breakdown maintenance, even reaching at one point where clamped leaking lines were clamped over to stop leaks. Necessary periodic wire brushing and painting of pipelines became a thing of the past. This, along with an absence of any type of cathodic protection resulted in defective and corroding pipelines which continued to be used out of sheer necessity to keep the business running. This, especially as the business seemed to be led by ‘bean counters’ and not industry professionals who would know better. Budgets for marine craft dry dockings and engine overhauls were routinely cut or deferred. It is to the credit of the port personnel that the port throughput continued under these conditions. Training and development of workers were curtailed. Disasters were simply waiting to happen.
This overall neglect also resulted in low worker morale and productivity. Salaries and wages would have increased because of strong union representation but the ‘Proud to be Petrotrin ’campaign often rang hollow especially at the waterfront. The centralized management system that evolved was refinery oriented and focused, with less than adequate resources remaining for the west area refinery offsites i.e. Marine and Oil Stocks. Marine also achieved the reputation for having very militant workers simply because the union recognized the strategic value of shutting down Marine first and foremost. With the mouth and the anus not functioning the refinery (stomach) ran the risk of shutting down was an analogy often used to describe the situation.
Now with the dawn of a new beginning what is the way forward?
THE WAY FORWARD.
· The recruitment, training, development and retention of qualified, trained individuals.
· Rigid, stringent and enforced entry level criteria that includes individuals with the capacity to be trained and developed for higher positions.
· An effective Performance Appraisal Program.
· A shift system appropriate for the marine industry e.g. 12 hour shifts 4 days on and 4 days off. Tug and barge crews to work 7 days on and 7 days off.
· The preventive, predictive and periodic maintenance of Port and Marine plant and equipment.
· Regular five-year interval surveys of the water depths and scheduled maintenance dredging as needed
· Authority and capacity to schedule and conduct own maintenance of port and marine plant and equipment.
The above provides good context for the path forward. It shows how a technical, results focused, performance-based team can deliver world class outcomes. This coupled with a strategic maintenance program are the first steps in the journey.
The path forward needs to have short, medium- and long-term goals. Short term goal is to assemble a merit-based team and perform immediate safety critical repairs to return the infrastructure to production. Medium term, revamp operating and maintenance processes to bring predictable outcomes to the plant infrastructure. Long term, focus should be on sustainability. Priorities being on right people first, right processes second and these will deliver plant operating and maintenance integrity.
To be continued. The way forward requires sustained hard work and commitment.
I would appreciate your feedback and suggestions.
I guess it did not pan out the way ‘they’ thought it would, Mr. Shah… That Khashoggi Effect.. 35% drop in one month..
in any event … we dogs dead for-real..
Comments are closed.