Total constructs $50 million storage facility in Puerto Rico terminal

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To improve resiliency, doubles capacity, equivalent to 6 weeks of sales

SAN JUAN – After a $50 million investment, Total Petroleum Puerto Rico Corp. inaugurated Wednesday two 300,000-barrel fuel storage tanks it constructed to expand capacity equal to what executives said was six weeks of sales.

The company will now have 600,000 barrels available at its facility in Guaynabo.

“The interest for this project is for [Total] to have more storage to be more resilient in case of experiencing another weather event. We all know that having large-capacity storage is necessary in case of an emergency. Today we have twice as much as we had when Hurricane Maria struck,” said the general manager of Total Petroleum Puerto Rico, Pierre-Emmanuel Bredin.

Total Puerto Rico General Manager Pierre-Emmanuel Bredin (Courtesy)

“This expansion makes us more competitive because up to today we had to have the tanks almost empty to receive a new ship with fuel because it arrived just in time and sometimes caused the ships to stay out at sea so while the tanks were emptied in the terminal to make room. That involved an operational cost, but that will disappear now and we will have a better operation,” Bredin explained.

As part of the investment, an amount was allocated to address the environmental factor with a new water system as well as safety, including new levels to address issues such as fire extinction. Both matters represent about 40% of the overall cost of the project.

An innovation in the connection design of the two new tanks allows any overflow to move to the second tank. This feature reduced the need to build an outer cover of greater containment, a breakthrough for future company projects of a similar nature.

The project was initially tendered and won by the local contractor Lord Construction, which began its work in January 2017. The construction had been scheduled to be completed and put into operation in March this year. Around 130 people worked on the project, with some 200 workers on the construction site.

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“This important investment in the last two years signals Total’s commitment to Puerto Rico. It allows Total, as an important player in responsible energy, to strengthen our roots in the Puerto Rican market. It also represents a clear demonstration of our commitment to deliver our products and services to our customers every step of the way,” said Momar Nguer, president of Total Marketing & Services, a division of Total Group with 31,000 employees in 109 countries.

“The expansion of the terminal in Guaynabo serves to highlight the ability of [Total Puerto Rico] to execute an industrial project, and we are proud to have completed the project on time, within budget and, most importantly, without accidents,” Bredin said.

Meanwhile, the executive said, Total is also investing $20 million to remodel and renovate its service stations, nearly 90% of which were affected by Hurricane Maria. The work includes remodeling stations roofs as well as the labeling that includes the identification of fuel prices for sale.

In addition to the investment, the company has focused on redoubling emergency response plans based on the experience from María. Its new emergency plan is a new benchmark for Total’s operations around the world.

As part of the plan, it purchased more trucks of different sizes to facilitate the delivery of diesel and gasoline to stations and industrial customers, in addition to directly supplying its customers’ commercial diesel generators. In addition, the supply of lubricants was extended to supply trucks, industrial fleets and generators.

The new response plan includes enabling external areas in the terminal to serve retailers as well as having areas at the stations for customers of the fleets at certain times.

To questions from the press about fuel prices, Bredin said that “in the supply chain, our part is small; there are many other elements that impact the price such as the international market in all countries of the world and the movement of prices. Our goal…is to have more customers all the time, so whatever efforts we can make, we make.”

Regarding customer demand and the company’s sales on the island, Bredin said the market had dropped, probably due to the high outmigration to the states.

“There are other important works that are going to start with the reconstruction of Puerto Rico and that is going to positively impact the market, so it’s a bit of a low moment, but normally that should come a little later,” he said.

Although Total only established itself on the island in 2004, the executive said it holds 17% of the market share. The company has consolidated its presence in the oil, lubricant and aviation businesses. It has more than 200 service stations, as well as aviation terminal facilities in Puerto Rico and St. Thomas. In addition, it has 70 convenience stores under the Bonjour brand.




NPP Senator Demands Knowing Whereabouts of Oil Tax Revenue

SAN JUAN – New Progressive Party (NPP) Sen. Ángel “Chayanne” Martínez was demanding Tuesday that Government Development Bank (GDB) President Melba Acosta “immediately disclose” where the tax revenue from petroleum products and the price of crude oil, better known as “Crudita 1 and 2,” has gone.

Ángel ‘Chayanne’ Martínez 2The first of these measures was Act 31 of 2013, establishing a $9.25 tax per barrel or fraction of crude oil, excluding only natural gas. Last year, the tax was doubled after the adoption of Act 1 of 2015, commonly known as “Crudita 2,” the revenue of which is allocated to the Highways and Transportation Authority.

“Three years have passed since the adoption of the first version of the Crudita. At that time, the tax was sold by the majority of the Popular Democratic Party as the only salvation for public finances. We all know that was not what happened. It is time for accountability. The president of the GDB is responsible for detailing all revenue generated by both versions of the Crudita and where it has gone,” the senator for the District of Arecibo said in a statement.

Martínez, who is also the spokesman for the NPP delegation in the Senate Health Committee, filed a resolution of inquiry to order the Treasury and Public Finance Committee to conduct an investigation into the use of the revenue from the petroleum products.




Commission Launches Hearings on Prepa’s Oil Purchases

The Special Commission for the Study of Norms & Procedures Regarding the Purchase & Use of Petroleum by the Puerto Rico Electric Power Authority (Prepa) was scheduled to launch public hearings Feb. 2, at 10 a.m., in the Capitol’s Leopoldo Figueroa Room, which are expected to extend throughout the month.

Among those summoned to testify are former Prepa executive directors under various past administrations, former presidents and members of the Government Board, past and present functionaries, fuel suppliers, and top management from labs and other experts. They are expected to testify regarding the purchase, management and use of petroleum.

“[Puerto Rico] should be very aware of the development of these public hearings,” said Aníbal José Torres, chairman of the commission. “We want people to know about Prepa’s operations regarding the purchase of fuel and the results that our investigation will reveal.”

Torres said the commission is ready to present Puerto Rico “the truth that we have discovered about Prepa’s fuel-purchase processes, the lack of formalities, the manipulation of processes and noncompliance that have had an impact on the cost of energy.




Gas Wholesalers Lower Gas Prices After Public Hearings Announcement

GasNozzleThe price of gasoline in Puerto Rico is expected to decrease in the coming days.  Gasoline wholesaler companies had to appear at the public hearing being held by the Senate Commission of Consumer Affairs, but requested 10 additional days to submit their presentations.

“We are giving them fi ve days to come and testify,” said Popular Democratic Party Sen. Luis Daniel Rivera Filomeno.

Rivera Filomeno said he wouldn’t hesitate to file legislation that forces both gas wholesalers and retailers to honor the price reduction to consumers. He said the purpose of the hearings is for consumers to see the price drops in gas with the same expediency as when the price of oil rises. He said the result of the investigation should result in that the savings from the drop in gas prices due to the continuing fall in oil prices won’t remain in the pockets of wholesalers or retailers, but goes directly to consumers’ pockets.

By Sin Comillas