“ Benefits of Petro-Caribe were being channeled away from the intended beneficiaries of the program, the Government and People of the recipient countries, towards a coterie of private interests;”
In June 2007, the MUSA administration being ill prepared to deal with the Petro Caribe initiative, awarded a contract to Petro Fuel Belize Limited (hereinafter, PFBL). PFBL, a subsidiary of the Big Creek Group, was awarded the right to import and distribute on the local market refined petroleum products, lubricants and LPG delivered under the Petro-Caribe Agreement.
The table below attempts to illustrate the loss to the Belizean Public as a result of that ill advised move by the MUSA administration. The income and fuel imports figures are actual figures reported to GOB rounded to the nearest million. The local expenditure is a generous estimate.(see table)
A report entitled “Brief History” at a Petro Caribe (http://www.petrocaribe.bz/)
web site states that, “During the period 2007 to 2009, PVDSA (Venezuelan counterpart) delivered 457,680 barrels (19,222,560 gallons) of refined petroleum products valuing over $41 million USD (FOB).” From the above financial data received from a reliable source, PFBL is only reporting receiving Belize $63 million worth of product. What pray tell has happened to some Belize 19 million dollars worth of products?
The report went on to state, “It appears that the authorities in Venezuela were not satisfied with the supply business model being utilized amid feedback from other countries that the benefits of Petro-Caribe were being channeled away from the intended beneficiaries of the program, the Government and People of the recipient countries, towards a coterie of private interests; and hence sought to exert tighter control over the program. “
PFBL creamed off the Belizean Public entitlement from June 2007 to September 2009. In 2009 the contract lapsed, and it was not until 2012 that the UDP Administration renewed the program under the very same conditions given to the MUSA government. The UDP true to form has been able to work wonders with the proceeds from this program given the favorable payment conditions set forth below.
FINANCING PROVISIONS
• The Agreement provides for a portion of each invoice (for each different product being purchased), called the ‘Financed Portion’, to be paid over 15 years at 2% interest rate with a two-year grace period, if the FOB spot price of the product being purchased is equal to or less than $40 USD per barrel. If the FOB spot price of the product purchased is higher than $40 USD per barrel, then the financing period extends to 25 years and the interest rate falls to 1%.
• The level of the ‘Financed Portion’ shall increase as the price per barrel of the petroleum products purchased increases. Agreed schedule.
• The remaining portion of the invoice, called the ‘Cash Portion’, is payable within 90 days, with a financing charge of 2% per annum levied after 30 days.
The achievement of the UDP given the availability of working capital from the above provisions has the PUP green with envy. The PUP Deputy leader has been livid and having sleepless nights trying to derail the UDP’s success train. Unfortunately for Julius “Droolus” Espat he will experience nightmares before that happens. Julius has been clamoring for an audit of the Petro Caribe fund, but how can the PUP explain giving away the profits from their term intended for the Belizean people? At least all rational thinking Belizean can appreciate the physical tangible transformation country wide being done by the UDP courtesy the proceeds of the Petro Caribe initiative.
