The crude oil trading business operated by Petrolin Group always results in published reports and newspaper articles.
This is normal as Petrolin Group, a Geneva-based company, is committed to Transparency. It does so in full respect for the will of its clients, and in strict compliance with international standards.
Oftentimes, however, groundless statements are made repeatedly on our marketing of crude, without any due diligence verifications whatsoever. It is in a bid to set the record straight that, today, Petrolin Group wishes to remind the strong anchoring of its policy for Africa’s development, in defending the interests of local petroleum producers, including the States. This is obviously the case in Gabon.
Furthermore, as regards its Trading activity in that country, Petrolin Group would like to make the following clarifications:
Some independent producers in Gabon entered into agreements with Petrolin Group for the marketing of their share of production as well as those of their partners when the latter were contractually responsible for said marketing. It is in this context that, between 1995 and 2012, small quantities of crude oil belonging to the Gabonese State found their way into the large volumes put on the market by Petrolin Group.
Petrolin would organize the joint loading of small crude oil batches from the marginal oilfields so as to have full cargoes of crude from Africa (Cameroon, Benin, Nigeria, Angola, Gabon, Congo, and DRC), and from the Middle East (Yemen).
The standard size of cargoes would generally range from 900,000 (Nine Hundred Thousand) to 1,000,000 (One Million) barrels to optimize the marketing thereof. The benefits derived by the producers notably the Gabonese State included:
- Increased rates of crude liftings
- Cash flow availability on a more regular basis
- Reduction of risks associated with price fluctuations as a result of crude liftings being well distributed over the year.
The oil cargoes were sold within the framework of international invitations to tender conducted in full transparency vis-a-vis our suppliers. Thus, the Directorate-General for Hydrocarbons (Ministry of Mines and Hydrocarbons) received a report on the bids received as soon as the results of the invitation to tender were known. The bids received within the framework of our tendering procedures, which were highly competitive, allowed our suppliers to get the best possible prices.
This marketing strategy also enabled Petrolin Group to circumvent the multitudinous external pressures. The bidders who won our invitations to tender included Addax, BP, ConocoPhillips, ExxonMobil, Glencore, Hess Corp., Reliance, Shell, Sinochem, Sun, Vitol, etc.
We can also ensure that our tender strategy was beneficial to the Gabonese State insofar as it allowed the Administration to secure another source for the market price evaluation of its crude, notably in their discussions with the producers to set the monthly Official Selling Price for the various Gabonese crudes.
All crude oil batches marketed on behalf of the Gabonese Republic were paid for 30 days after the date of loading (in strict compliance with generally accepted oil industry practices) directly into the account of the Ministry of Finance, pursuant to the instructions of the Ministry of Finance.
Furthermore, all payments made by Petrolin Group to the Gabonese Republic were reported annually to the Extractive Industries transparency Initiative (EITI) during the period of Gabon’s membership in this program.