Jamaica refinery project hits snag

Jamaican state refiner Petrojam, which has come under scrutiny following an audit, now faces a new challenge.

Prime Minister Andrew Holness has announced that the government will return a US$100mn loan secured from the Ministry of Finance to develop a vacuum distillation unit (VDU) at the refinery.

"It doesn't make sense to have the money [idle], when the government has hundreds of other things that it could use it on to increase the revenue base," government news service JIS quoted Holness as saying.

He attributed project delays in part to US sanctions on Venezuela which owns 49% of Petrojam through PDVSA.

Finance minister Nigel Clarke added that Petrojam's association with the NOC meant that Petrojam parent Petroleum Corporation of Jamaica could not borrow from the international private market.

According to Clarke, should PCJ/Petrojam encounter challenges sourcing private capital market funding for the VDU project in the future, the government/ministry may lend again.

BNamericas previously reported that Petrojam was evaluating documents submitted in a prequalification call to provide project management consultancy services.