WILLEMSTAD - Information that has been confirmed by sources close to the refinery says that the refinery is now in serious financial trouble. The situation is so dire that the Isla refinery has enough money for only three to four months salary for its own employees. Initially the PDVSA owned Isla Refinery indicated that they will be able to pay salaries until the end of this year but now it appears that this is not the case.
Given the current circumstances, the facts are now that after the payment of the March payroll there is still money for two to four months; the employees were also told that efforts are being made to generate income.
In other words: if nothing changes for the better, the Isla refinery can still pay the salaries up to and including July, but Refineria Isla also considers that by the end of May the well’s run dry.
Cash flow is increasingly becoming a problem for the subsidiary of PdVSA. The Venezuelan state oil company itself, just like the country Venezuela, is in the biggest financial crisis. The fact that Refineria Isla has survived, while the production has been at a standstill for almost a year, is because the refinery still had its own reserve.
But after the local government distribution company Curoil has stopped purchasing fuel products, there is hardly any more revenue.
The supply of crude oil is the biggest problem, after earlier utility supplier Curaçao Refinery Utilities (CRU) also contributed to the problems through faltering production. Since May 2018, seizures by major international creditors have made it almost impossible for oil tankers to sail to Schottegat and Bullenbaai. And the sanctions imposed by the US government added to that. The tightening of the US sanctions will reach their maximum effect on April 28, when PdVSA can hardly move any further.
These sanctions have serious consequences for the Curaçao economy which relies heavily on the oil refinery and other harbor activities.
Contractors working at the refinery were recently told that they must reduce costs by 50 percent. Approximately as many people work for contractors as are directly employed by Isla.
