The Full Story
The Government is reiterating its commitment to safeguarding the country’s energy security and assures that it has made the right decision to retake ownership of the 49 per cent shares in Petrojam held by the Venezuelan state-owned oil and natural gas company, PDV Caribe.
First announced last week, the Government said it would be taking legislative action in furtherance of obtaining the shares and would begin the formal process in Parliament in short order.
At a press conference at the Office of the Prime Minister today (January 14), Foreign Affairs and Foreign Trade Minister, Senator the Hon. Kamina Johnson Smith, emphasised that the decision taken was out of recognition of a number of important factors.
These include the numerous efforts and need to upgrade the refinery from as far back as 2006, the Jamaica Public Service Company (JPS) decision to convert to liquefied natural gas (LNG) in 2019 as well as the fact that JPS makes up 50 per cent of Petrojam’s market.
Additionally, new international regulations will make it difficult for Petrojam to sell heavy fuel oil and process it as it now does, which takes effect on January 1, 2020; and banking and operational risks caused by domestic and hemispheric issues and challenges experienced by Venezuela.
“Accordingly, it is important and in the interest of the Jamaican people that the Government of Jamaica take decisive and clear action. We are, as a Government, committed to ensuring that we do our very best to make decisions that will secure our energy sector in the interest of the Jamaican people, notwithstanding our appreciation or work with third-party states,” she said.
Senator Johnson Smith said the decision was not made without recognition and appreciation of the “space that the Petro Caribe arrangements gave us and the relationship between Venezuela and Jamaica that dates back to the days of Simón Bolívar seeking refuge in Jamaica”.
She advised that the Government did make attempts to offer incentives to the Venezuelan Government in the hopes of them selling the shares. However, there has been no take-up.
“We did not just offer fair market value, we offered three times that at the first instance and at the second instance. We then increased it further in November (2018),” she said.