WILLEMSTAD - Due to the loss of turnover at the state-owned company Curaçao Oil (Curoil), estimated at 40 million guilders at the end of this year, and the liquidity problems that result from this, two parallel financing projects are being used to close this gap.
According to Curoil's director, Yamil Lasten, in addition to the guarantee component in the rate structure of 22 cents on petrol and diesel - which will only close a small part of the gap - a request has also been submitted to a local bank for refinancing the credit facility and a request for financing from the Netherlands. The Netherlands has asked the Financial Supervision Council (Cft) for advice on this.
"It is conceivable that the 22 cents arrangement can be recalled," added Lasten. He explains that the local refinancing at the bank includes the amount of 40 million. Repayment of this debt can be extended over a longer period and the liquidity problem of today is solved. Both institutes, both the bank and the Cft, have asked additional questions.
Lasten indicated that in view of the discussion about the government company and the negative perception of it, he notices that authorities want to know more about their (financial) policy. “Fortunately, we have a business that runs in accordance with good governance, which is why I am positive about both financing options,” says Lasten. The director indicated that the Cft will soon have to issue advice to the Netherlands about the company’s request and from the Netherlands he expects that there will be various conditions attached to the financing, which incidentally specifically concerns Curoil and therefore does not go through the government.
A further explanation of the pricing of petrol and diesel, which directly affects a large part of the citizens, shows that people often link the oil price to petrol or diesel price. Nothing could be further from the truth, explains Lasten.
“Crude oil and distillates (such as petrol and diesel) are different markets. There is a connection, the correlation is about 30 percent. The remaining 70 percent are independent of each other. It may even be the case that oil prices are falling and that the costs of distillates are higher. That depends on, for example, operating costs of refineries and transport costs.”
Lasten indicated that it is a false assumption that purchasing these products from the island’s own refinery is by definition cheaper. “The price of distillates consists of a market price and premium that the supplier charges. The local refinery is currently charging a much higher premium than what we pay on the international market.”
The Curoil director explains that the Bureau Telecommunication and Post (BT&P), as an independent institute, determines the rates and that this is done based on the invoices from two months before. There are two types of volume contracts with Curoil. There are suppliers who store oil in tanks on the island, also pay lease for this and when Curoil buys products, this supplier is paid the price of the day. Depending on the price fluctuations, this can be beneficial or disadvantageous for the supplier. Curoil also purchases in advance with a volume contract from a supplier who delivers on-demand and then at the cost of the purchase.
Curoil's turnover consists of two parts, an international component (60 percent of turnover) and a local component (40 percent). International concerns income from bunkering, ships coming to load and the sale of aviation fuel. Bunkering caused a loss of turnover of 80 percent and aviation fuel 60 percent. Locally there is 60 percent less turnover.
