First published in The Tribune April 17, 2018
Oban Environmentalists: Relax
Those who worry about the hypothetical Oban refinery, with its port facility and storage tanks, destroying the wetlands and fishing grounds of East End Grand Bahama should heave a sigh of relief: it won’t be built, in any conceivable time-frame. Construction won’t even get started. An environmental impact statement, although always welcome, will be irrelevant.
Although Oban President Satpal Dhunna appears to have enlisted a couple of professional experts in refinery operations and project creation, they will be defeated by hard economic facts: $5.5 billion new capital investment simply cannot be raised for an unproven start-up venture that has neither a committed supplier of crude oil nor purchasers of refined products, particularly in this era of uncertainty about the very future of carbon-based energy.
If Buckeye-Borco and Statoil, building on strong assets with years of commercial and technical experience, do not choose to go the refinery route, what chance has a newcomer like Oban, which could take up to ten years to build and start earning?
On any rational basis, PM Minnis should pull the plug on Oban so that he could focus on realistic projects of positive benefit to Grand Bahama. Legally, there could be no objection to cancellation of the Heads of Agreement. The only obstacle would be his own pride or simple inertia. In that case, like old soldiers, Oban will never die, it will just fade away.
Freeport as Industrial Center
In a recent conversation with Mick Holding, President of Grand Bahama Chamber of Commerce, he lamented that no good news was reported from the Island, since its industrial side had great potential but is rarely publicized. Of course he recognized the blight on tourism from the continuing failure to re-open Grand Lucayan Hotel and energize the once dynamic and fun-filled Port Lucaya complex.
But tourism is not the only economic driver. We considered a few of the others:
- Grand Bahama Shipyard (where he was a long-time senior executive), one of the world’s prime facilities for dry-docking and major marine repairs, with a specialty for cruise ships, servicing 23 of the monsters last year, employing hundred of skilled workers.
- Just across the harbor, Freeport Container Port serves container ships from 1,500 meters of quay frontage and ten rolling Post Panamax cranes, making it the largest transshipment terminal this side of the Atlantic.
- Buckey Pipeline absorbed Borco to operate the one of world’s major petroleum storage terminals with 26 million barrels capacity, capable of blending crude into distillates
- Just outside the free zone, the StatOil terminal performs much the same function for its Norwegian parent, an integrated petroleum enterprise with international scope.
- Pharmachem Laboratories produces pharmaceutical specialties primarily for Gilead Sciences and is completing a $120 million expansion requiring an increase to its 220 work force.
- Polymers International makes the polystyrene beads for the billion of styrofoam cups and containers cranked out by its US parent company Dart Industries.
- Bradford Marine is a favored location for hull and engine repairs of large yachts, combined with rebuildings and refurbishment projects.
These companies, usually integrated into the over-all operations of their foreign parents, are wary about financial figures in their competitive businesses, but surely the Port Authority or the Chamber of Commerce could.
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Mr. Coulson has had a long career in law, investment banking and private banking in New York, London, and Nassau, and now serves as director of several financial concerns and as a corporate financial consultant. He has recently released his autobiography, A Corkscrew Life: Adventures of a Travelling Financier.
