Locals Negotiate for Curacao Contract

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Locals Negotiate for Curacao Contract
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The government agency overseeing Curacao’s Isla Refinery has chosen to negotiate with a consortium of local organizations as it attempts for a fourth time to select an operator to replace Petroleos de Venezuela S.A.

The consortium – Curaçao Oil Refinery Complex – and Refineria di Korsou said this month that they are not in exclusive negotiations and that they hope to reach an agreement by March 1.

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The deteriorating 335,000 barrel per day fuels refinery, which is located in the capital city of Willemstad, has been operated by PdVSA since 1985, but the island country has been looking for a replacement for several years after concluding that the state-owned Venezuelan oil company was failing to maintain or improve the facility.

The refinery includes a base oil plant with capacity to 5,000 b/d of paraffinic API Group I base stocks and 3,700 b/d of naphthenic base stocks.

Since 2017 overseer Refineria di Korsou has selected three companies with which to negotiate a contract, but in each case the deal ended up falling through.

On Jan. 4, the agency announced that it had reached that stage again, choosing CORC from a pool of numerous bidders to negotiate a contract to operate the refinery, as well as an oil terminal at Bullen Bay and other facilities. Refineria di Korsou did not disclose the make-up of the consortium, but the consortium did in a Jan. 11 news release.

The group consists of Dick and Doof Contractors B.V., the Petroleum Workers Federation of Curcao and the Association of Employees and Staff of Isla Refinery. Dick and Doof is a Curacao company providing services to the full range of the energy sector, and it has provided maintenance services at the refinery. The press release added that Javier Hernandez, a long-time director of the refinery, is also a key member of the consortium.

The government is anxious to reach a final agreement, in part because the refinery has operated intermittently the past couple years, and concerns have been raised in recent months that equipment could sustain permanent damage. In addition, officials would like to reach a deal before national elections, which are scheduled for mid-March.

Chinese energy company Guangdong Zhenrong Energy was the first to be selected for exclusive negotiations, followed by U.S.-based refiner Motiva and German refiner and oil trader Klesch Group.

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