The state-owned Guyana Oil Company Limited (GuyOil) has denied the Ministry of Finance’s half-year’s report, which said that shipment of fuel in February was contaminated.
The company was last week correcting what it says were a few inaccuracies in a report carried by this publication.
The Finance Ministry, in its report of GuyOil’s performance had this to say: “Mogas, Kerosene and Gasoil sales were 35,701 barrels, 4,632 barrels and 33,624 barrels lower than 2018, respectively. In addition, given price competition and the contamination of a shipment of Super 95 Gasolene in February 2019, overall sales declined. However, a market plan is in place to address this, and includes public outreaches, volume discounts and a dealers’ rebate programme.”
Back in February, a number of vehicles caught fire and there were accusations. GuyOil has denied that its fuel had a problem.
However, in a letter to Kaieteur News last week refuting this, the company had this to say: “Additionally, GuyOil wishes to inform you that at no time in 2019 was any shipment of fuel contaminated. GuyOil subscribes to Global Fuel Standards as set out by the American Society for Testing and Material (ASTM), and all imported fuel is tested at the port of loading by an independent certified laboratory. GuyOil is compliant with local and international standards and has quality assurance systems that are strictly adhered to. At GuyOil, we always strive to supply products of high quality to our customers.”
The company is also clarifying that its half year sales did not drop $1.3B as stated in the headline but rather $859M when compared to the same period in 2018.
“However, as stated in the article, it was the cash flow receipts that declined by $1.3B. Further, it should be pointed out that both lower sales volume and lower acquisition costs were the factors that contributed to the lower sales value (revenue).”
The situation of GuyOil’s sales have been under scrutiny for a number of years now amid evidence of significant smuggling and direct competition to the company.
Significant sales to the ‘gold bush’ and hinterland locations have accounted for a big slice of the fuel market to smugglers and other private individuals who have been granted import licences.
It was reported in December that GuyOil lost ground in its gasoline sales in 2017, thanks to smuggling among other things.
In its 2017 Annual Report, it was reported that net profit had decreased almost 29 percent.
GuyOil competes mainly with SOL and Rubis.
The company’s business involves the importation, storage, distribution and marketing of motor gasoline, gasoil, kerosene, fuel oil, and Castrol lubricants.
The products are distributed through the large network in the petroleum business in Guyana, comprising 52 dealer-owned, dealer-operated, and eight company-owned, company-operated service stations.
Its three terminals are at Adventure, Region Two; Providence, East Bank Demerara and Heathburn, Berbice.
Since the loss of the Venezuela supplies in 2015, Guyana had turned to the Petroleum Company of Trinidad and Tobago (PetroTrin) refinery in Trinidad which is the main supplier of Mogas, Gasoil, Kerosene, and Jet A1; and Staatsolie Maatschappij, Suriname.
It is now reportedly sourcing from Jamaica.
According to Chairman Mark Bender’s report of 2017, “Despite the increasing manifestation of smuggled/illegal fuel and the increased number of licensed private importers, GuyOil maintained its dominant position in the Guyana market and continued to be the leader in stabilising fuel prices, to the benefit of the Guyanese consuming public and industries.”
According to the sales revenues, in 2017 sales were $35.259B, compared to $31.939B in 2016, an increase of $3.32B or 10.39%. Cost of sales was $30.465B compared to $25.889B in 2016, an increase of $4.576B or 17.68 percent.
With regards to the sales volumes, GuyOil managed to reach 1,309,093 barrels compared to 1,287,211 barrels in 2016, an increase of 21,882 barrels or 1.7 %.
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