Oil chief: Company on right path
THE Acting General Manager at the Barbados National Oil Company Limited (BNOCL), Winston Gibbs, has refuted an audit firm’s comment that the company’s viability as a going concern was in doubt.In a Press release issued yesterday, Gibbs in responding to an article which appeared in the WEEKEND NATION quoting an audit conducted by PricewaterhouseCoopers, stated that far from there being doubt about its continued viability, the BNOCL “was on a very strong and sustainable growth path”.Gibbs further stated that the audited financial report for the year to March 31, 2010 to be released shortly, would show that the company had completely reversed the overall shareholder’s deficit and was in a profitable position.According to the audit for the year ending March 31, 2009, the group company had an accumulated deficit of $95 891 385 and a shareholder deficit of $44 676 576. BNOCL’s financial statements also reflected a net loss of $487 812 806.The auditors noted: “These conditions indicate the existence of a material uncertainty which may cast significant doubt about the company’s ability to continue as a going concern.”Gibbs said that during the periods of high crude oil prices (2007/2008), the Government, as shareholder, mandated the company subsidise gasoline, diesel and electricity to industrial, commercial and domestic consumers. These subsidies, he noted, amounted to approximately $38 million for electricity, $84 million for gasoline and $79 million for diesel.
He said that in October 2008, the subsidies were discontinued and a pricing mechanism was introduced by Government under which the Cost, Insurance and Freight (CIF) prices of these products were passed on to consumers. “This pricing mechanism additionally made provision for BNOCL to recover losses which were caused solely as a result of these subsidies,” said Gibbs. (PR)