Page 4 - LatAmOil Week 29 2020

LatAmOil COMMENTARY LatAmOil

The Isla refinery is in poor condition (Photo: Van Diemen Sloopwerken)

Curaçao’s plans for bringing

Isla refinery back on line fizzle

RdK, the state-owned company that operates the plant, says talks with Klesch Group have collapsed

LAST year, Curaçao appeared to be optimistic Dashed hopes
about its chances of reviving the Isla oil refinery. As a result, RdK began 2020 on an upbeat note.
WHAT: Now, though, its path towards this goal appears Its optimism diminished following the advent
Negotiations broke to have reached a dead end. of the coronavirus (COVID-19) pandemic,
down after Klesch Group The Dutch Caribbean island’s initial opti- however, as the pace of its negotiations with
indicated that it could not mism was justifiable. In the autumn of 2019, Klesch Group slowed because of the restrictions
bring the plant back on Refineria di Korsou (RdK), the state-run com- on travel and movements introduced by the
stream by year-end. pany that owns the Isla refinery, named Gene- government.
va-based Klesch Group as the winner of a tender Initially, both sides were hopeful that the
WHY: for the right to take over the facility. It also delay was only temporary, and they said they
Curaçao’s economy will signed a preliminary asset purchase and sales hoped to finalise a deal before the end of June. As
suffer if the refinery agreement (APSA) with the company. a result, RdK was willing to continue covering
remains idle. RdK indicated at the time that it hoped to salary payments to the Isla refinery’s workers.
finalise a deal with the privately held industrial In recent weeks, though, the company has
WHAT NEXT: commodities firm within just a few months. determined that it can no longer afford to foot
RdK’s plans to lease out It also took the step of allowing its agreement this bill. It therefore began pressing Klesch
the facility’s storage with Venezuela’s national oil company (NOC) Group early last week to outline its plan for
capacity may entail PdVSA, which had been operating the refinery wrapping up an agreement on the refinery. But
additional expenses. under a rental contract since 1985, to lapse at the the commodities firm was not able to satisfy
end of 2019. RdK’s request for clarification

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