Conditions Eased for Potential Isla Operator


The Curacao government has received interest from at least 15 companies to operate the Isla Refinery, the director of the search said to a local outlet this week, four months after it announced it would have to restart the process all over again.

Patrick Newton, director of the government agency Refineria di Kursao, which owns the refinery, revealed a key change to the new round of bidding: companies will now only need to commit to a five or 10-year lease, rather than a 30-year lease as previously required.

“By relaxing conditions, we are making the deal more attractive,” Newton told Curacaoan news outlet Antilliaans Dagblad. Newton further predicted the refinery would “gain relevance” in the next two or three decades due to potential easing of sanctions of crude oil from Venezuela and developments in demand for oil products.

In an interview with Lube Report last year, Newton also pointed to the development of more favorable market conditions than in previous years of its search.

In April, RdK ended negotiations with its latest preferred bidder, a consortium named Caribbean Petroleum Refinery.

Negotiations with CPR were scheduled to conclude last September, but the process was fraught with complications after allegations of forged documents submitted by the consortium. CPR was comprised of six United States companies and one Brazilian company.

The search has lasted five years. Previous rounds of efforts to choose an operator each also led to negotiations with preferred bidders – all of which came to naught. Those companies were local consortium CORC, German oil trader Klesch Group, United Kingdom-based SPS Drilling E&P, United States-based Motiva and Chinese company Guangdong Zhenrong Energy.

CORC, Klesch Group and SPS Drilling each signed a lease agreement, but the deals fell through for various reasons.

The search for an operator can take over a year to conclude. RdK began the previous process in January of last year before talks with CPR broke down this April.

State-owned Petroleos de Venezuela S.A. operated the refinery from 1985 until 2019, though the Willemstad facility was idled beforehand due to economic sanctions imposed against Venezuela and a failure to secure crude oil after U.S. oil company ConocoPhillips sued PdVSA over a disputed payment. Isla Refinery is a fuels refinery with capacity to process 335,000 barrels per day of crude oil. It includes a base oil plant with capacity to produce 5,000 b/d of API Group I paraffinic base oils and 3,700 b/d of naphthenic base stocks.