Government in talks on new fuel depot

Progressives trumpet first-year wins

Listed, but perhaps little noted, among the Progressives-led government’s accomplishments during its first year in office was the signing of a memorandum of understanding toward the possible establishment of a “modern bulk fuel facility.”  

Premier Alden McLaughlin gave an overview of the accomplishments in Legislative Assembly last week, but the sentence on page 13 of the 19-page document made public in the House was not included in the report highlights.  

“Government signed a memorandum of understanding in April with Navasota [Energy} regarding the possible establishment of a bulk fuel facility,” the government report entitled “On course: Achievements 2013-2014” read.  

According to government representatives, the Progressives caucus met earlier this year with Navasota representatives on the proposal and Cabinet signed the memorandum on the project in April.  

Planning Minister Kurt Tibbetts said Monday that the proposal, in which Navasota would act as a consultant or adviser to government, is not costing anything and that government is only at the discussion stages at the moment. However, he said it is an idea worth considering.  

“The Cayman Islands location has geographical advantages for the supply of fuel to various other Caribbean jurisdictions,” Mr. Tibbetts said. “So Navasota has entered into a … memorandum of understanding with the Cayman Islands whereby they are going to seek interested parties and, if they are successful … then we will sit and talk to these interested parties to see whether it is something that is feasible or not.”  

The proposal would consider an onshore bulk storage facility that could initially fill fuel tankers heading to the central and eastern Caribbean Sea. If it goes forward, a storage location would need to be considered close to shore, but in a far more remote area than the current bulk storage facility in South Sound. 

However, that might not be the only use for such a facility, and Mr. Tibbetts said in the long term it could eventually be used to replace the current facility in South Sound.  

“If something like this becomes feasible, it is very likely that Caribbean Utilities Company and other local entities could get their fuel much cheaper than they’re getting it now,” he said. “It could also be a means by which more competition is brought to bear in the retail fuel sector, but all of these things are what we are going to be examining.”  

The current fuel storage station in South Sound was identified as a potential health and safety hazard, not because of its location in what has become a fairly dense residential area, but because its large volume fuel lines run directly under several George Town neighborhoods, including Windsor Park.  

“That’s certainly what we would avoid in the future … a proper tank farm could well cause the ones in South Sound to become obsolete,” Mr. Tibbetts said. “It is certainly worth looking at.”  

January discussion 

The creation of an alternate bulk fuel facility was discussed in vague terms during a Legislative Assembly meeting in January, following a parliamentary question asked by Opposition Leader McKeeva Bush about the sale of one of Cayman’s two major fuel suppliers, Esso, to a Bahamas-based company, Sol.  

Minister Tibbetts said at the time that competition would continue between Rubis and Sol fuel companies the way it had always been between Esso and Chevron-Texaco in the past.  

However, the planning minister also introduced the notion at the time that the government would support efforts of the largest purchaser of diesel fuel in the islands – Caribbean Utilities Company – to seek lower bulk diesel prices from a potential third supplier.  

“The competition might well begin at the point at which CUC gets its supply,” Mr. Tibbetts said in January.  

Later on in the debate, the minister said it might be “in the country’s interest for there to be a larger supply on hand for fuel, not only for CUC, but for local consumption.”  

During the parliamentary discussion, vague reference was made to the possible establishment of another bulk fuel site, apart from the current location in South Sound, for local fuel storage and distribution.  

Premier: Goals met 

Premier McLaughlin congratulated his government on a number of accomplishments during its first year in office, highlighting especially its financial performance.  

Mr. McLaughlin said government’s projected $108 million operating surplus for the year, $8 million higher than initially projected was “amongst [government’s] chief achievements.”  

The premier also listed a number of economic development projects now completed or under way, including the Health City Cayman Islands project, Cayman Enterprise City, the Ironwood development project and various hotel developments, including the Londoner in East End and a planned Kimpton hotel on West Bay Road at the site of the old Courtyard Marriott.  

The premier also lauded the government’s National Workforce Development Agency which located job placement or job offers for 162 people between July 2013 and mid-May 2014. Caymanian unemployment fell from 10.5 percent in 2012 to 9.4 percent in 2013. 

Law enforcement services were also bolstered by increased hiring with the police, fire and customs services and the construction of a new police prisoner holding facility in the Fairbanks area of George Town.