Venezuelan President Hugo Chvez (right) and Trinidad and Tobago's Prime Minister Patrick Manning have signed an agreement to share natural gas reserves on their shared maritime borders. - Reuters Petroleum Company of Trinidad and Tobago Limited (Petrotrin) is about to tap the international market for US$750 million of financing for an ongoing refinery upgrading and acquisition of new equipment by issuing a series of amortisation notes with tenure of up to 15 years.
"This is so, yes," said Preston George, Petrotrin's vice-president, Human Resources. "We have a team now on a road show and they should be going to London with three stops in the U.S."
The float is being arranged by Citigroup, now rebranded Citi, according to documents obtained by Wednesday Business, with expectations that Petrotrin will tap the market by May 1.
Requests for comment from Petrotrin were unforthcoming up to press time.
The senior unsecured notes will be redeemed in 24 semi-annual installments of US$31.25 million, stating 2010 and ending 2022, the offer document said. The price and interest repayment periods were not finalised on the document.
The minimum subscription is US$100,000 and thereafter multiples of US$1,000.
Petrotrin, a fully owned state oil-gas producer and trader, has applied to have the notes listed on the Luxembourg Stock Exchange for trading on the Euro MTF market, a unit of the Luxembourg exchange.
The move to raise capital follows agreement on the sharing of reserves in a new natural gas field with Venezuela. Port-of-Spain, which will get a quarter of the estimated 10 trillion cubic feet of reserves, is trying to convince Caracas that its refining infrastructure puts it in a better position to land and convert thegas.
The programme involves the Fluid Catalytic Cracking Unit upgrade, the Pre-Fractionation/Isomerisation Unit, the Continuous Catalytic Regeneration Platformer and the Alkylation Unit and Acid Plant.
George said the project is well under way since 2005 with Engineering, Procurement and Construction (EPC) contract being awarded and site preparation, in some cases, already complete.
All the projects should be completed by December 2008.
The refinery reconfiguration is to meet the increasingly stringent international specifications for gasolenes and gas oils while increasing volume and improving quality of higher valued petroleum products.
Enhancement
Gasolene enhancement will result through the construction of a new isomerisation unit to convert low-octane naphthas to higher octane gasolene blending stock.
This will complement the recent upgrade of the fluid catalytic cracking unit and construction of a new 3,500 bpd alkylation unit also to provide premium gasolene blending stock.
George said the Gasolene Optimisation Programme will help the refinery to produce higher volume and quality and environmentally satisfactory gasolene blended components for the high end markets in the United States.
"At the end of the day, we will be able to increase the gasolene yields, improve energy efficiency and be environmentally compliant, " he said.
Petrotrin which currently produces 160,000 barrels of oil per day and also LPG and propane is a solid company, says George.
Although state-owned, the company functions with an inde-pendent board, he said.
Petrotrin, a TT$19 billion (US$3 billion) company measured by its assets, last year recorded average daily volumes of 142.45 mmcf of natural gas - a slight upturn on the year prior's 140.13 mmcf; and 70.71 mmcf of LNG, which dropped from 83.11 mmcf in 2005.
Trinidad which grew 12 per cent last year on the back of vibrant oil revenues - Petrotrin contributed seven per cent to the country's earnings - has a sovereign rating on its debt of A- by Standard & Poor's and Baa1 by Moody's. Anticipated ratings on the new issue are BAA2/BBB+.
Petrotrin debts at balance sheet date December 31, 2006 were US$1.9 billion, against total assets of US$3.1 billion (TT$19.4 billion).
Up to its financial yearend, September 2006, the oil and gas company had depressed profits of TT$1.3 billion (2005: TT$1.6 billion), despite a four billion climb in revenues to TT$25.8 billion (US$4.1 billion).
business@gleanerjm.com
Petrotrin
September 30, 2006.
| Revenues | | TT$25.8 billion |
| EBITDA | | TT$4.07 billion |
| Net Profit | | TT$1.31 billion |
NP Margin | 5.1% |
Assets | | TT$19.4 billion |
| (Dec 06) |
ROA 7.0% |
