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Jun 14, 2012

Musings of local oil refinery and Venezuela fuel

Dean Barrow

ExxonMobil, the parent company of Esso Standard Oil, S.A., sold the Central American assets in Belize along with refineries in Nicaragua and El Salvador to Puma Energy Limited in 2011.  The future of Puma’s operation in Belize may depend on discussions that the government is having with the government of Venezuela to procure cheaper fuel. And while the oil talks are still just talks, Barrow also spoke about the future of oil prospecting in Belize with the dream of building a local refinery.

 

Dean Barrow

“I should tell you on this front that we have commissioned jointly with BNE, the feasibility study on the building of a local oil refinery; something we had promised in our last manifesto. We have also started discussions with Venezuela and with PUMA. PUMA is the local successor to Esso here in Belize. What we are trying to do is to begin sourcing all of Belize’s imported fuel from the Bolivarian Republic. If we can bring this to a successful conclusion, we can then take advantage of the Petro Caribe arrangements to trigger the hugely concessionary financing that will accompany oil purchases from Venezuela. Some time ago, we had a very limited program. What Venezuela does is to sell us the oil at market rates but to only require us to pay a percentage up front and the balance of the sale price or the purchase price, we collect; in this case it would be from PUMA, but we are able to use in terms of a long term financing arrangement with Venezuela. So if we can bring these discussions to a conclusion; that would provide a tremendous degree of assistance. 

It is my sense that because they are big in Central America and in Latin America, there are economies of scale that would assist if they are able to source supplies for Belize and perhaps other areas of Central America out of Venezuela under the Petro Caribe arrangement. I can’t say any more than that. To some extent, clearly if PUMA is to sign on to the deal—I would imagine they would do so—because indeed they can realize some benefits from shifting the sourcing. But I really would be completely out of order to try to speculate too much into what their metrics are; into what their thinking is.”

 

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1 Response for “Musings of local oil refinery and Venezuela fuel”

  1. Rod says:

    Now barrow is going to the communist to get oil what’s next barrow why don’t you go to Guatemala for help also you know the us doesn’t want you doing business with Chavez but I guess we are in such bad shape you will do anything to make yourself look good it won’t work you are a total failure at your job if you were a CEO in a company you would have been fired long long long ago.

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