A high prevalence of illegal fuel in the market last year severely challenged the operations of the state-owned oil company, according to the 2010 annual report.
In the recently released 2010 Annual Report, Chairman of the Guyana Oil Company (GuyOil),
Dr. Keshav Mangal, also disclosed that the entity made a net profit of over $461M. Gross profit was $3.388B compared to $2.937B in 2009, an increase of 15.36 cent.
“The fuel business in Guyana continued to be characterized by high acquisition prices, aggressive competition, high prevalence of smuggled fuel and low margins,” Mangal said in his report.
Acquisition prices for refined petroleum products last year fluctuated between US$70 and US$90 per barrel.
The company continued to acquire fuel under the PetroCaribe Agreement from Venezuela from the refinery in Curacao which is the main supplier. Supplies were also taken from Trinidad.
“Despite the challenges, GuyOil continued to be the leader in stabilizing the prices of fuel products, to the benefit of the consuming public and industry.”
GuyOil sales were $26.374B, up by $4.122B over 2009 figures.
The company also sold over 977,000 barrels of oil, more than 24,000 over 2009.
During 2010, GuyOil spent almost $477M to fund a number of major investments. At Providence terminal, the company started construction on a mogas storage facility that will raise capacity by 12,000 barrels.
Two new service stations– at Diamond on the East Bank Demerara and Palmyra, East Berbice– were also commissioned last year, clear evidence that the company had started intense focusing on its retail business, the report stated.
Work was also done to modernize the Providence wharf facilities with a timber pier replaced by concrete structures.
According to the Chairman, while 2011 is expected to see further growth, there are major challenges still facing the company.
“The world economy has not fully recovered from the global financial crisis of 2008/2009, with a number of countries still facing recession. OPEC (Organization of Petroleum Exporting Countries) member states would like to maintain the price of crude oil above the US$70/barrel, and this will result in high prices for refined products. Management faces great challenges ahead to avoid adverse effects on the company in 2011.”
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