A review committee appointed by Jamaica’s Prime Minister, Andrew Holness, is recommending that the government of the Caribbean island nation get out of the refinery business and instead hand it over to the private sector.
According to a June 27 report in the Jamaica Gleaner, this is one of 12 recommendations contained in a 39-page report prepared by the committee, chaired by businessman Chris Zacca, who detailed the recommendations at a press conference at Jamaica House on Thursday.
The committee said the government should consider leasing the state-owned refinery and commission a petroleum industry enterprise team to chart its exit from the operational management of Petrojam.
The Gleaner report said in the past few months, the Petrojam management has attracted intense public scrutiny amid a series of scandals over its management including hiring practices and asset security.
In the meantime, the committee has also recommended that in the short term, Petrojam make every effort to maximise the processing of sweet crude oil to reduce heavy fuel oil production.
This is because Petrojam will take a hit when it’s largest consumer, the Jamaica Public Service Company, switches from using heavy fuel oil to liquefied natural gas to produce electricity, the Gleaner pointed out.
At the same time, come January 2020, a climate change treaty to which Jamaica is a signatory, will restrict high-sulphur heavy fuel oil being sold to the maritime/shipping sector.
“These two situations will create a severe marketing constraint for the current high-sulphur fuel oil products of the refinery and pose an existential threat to the refinery’s continued operation,” read a section of the report cited by the Gleaner.