Published On: Wed, Jan 10th, 2018

The implications of the legal relationship of the Curaçao Government with Guangdong Zhenrong Energy Ltd. Part II

WILLEMSTAD - In the recently concluded treaty of Paris on the climate changes, elaborate discussions were conducted as well as negotiations on how to reduce (or at least try to mitigate) the disadvantages of those climate changes. Resolutions were also adopted regarding the reduction of the fossil industry worldwide and on how to gradually move to developing sustainable energy sources worldwide.

The Kingdom of the Netherlands has ratified the resolutions, as well as the Country of Curaçao which was also present at the conference. According to the Ecorys-report the modernization of the Isla refinery in Curaçao is only to be realized by a dismantling of the existing refinery followed by sanitation of the environmental pollution and subsequently a rebuilding of a whole new refinery. This MoU therefore runs counter to those resolutions adopted on the climate conference. And the alternative plan to develop a fallback position by re-developing he area of the Isla in the event of a dismantling is nowadays completely hushed up and is being smothered by the single-minded search for a strategic partner to continue the refining activities.

It is doubtful, but most unlikely that any conscientious expert would be found to advise the Government of Curaçao that there might be reliable parties available to invest 3 to 5 BILLION of USD in the project of modernizing the Isla, seeing that the petrochemical branch of the fossil industry is rapidly dwindling, due to the unstoppable advance of the electric car. As a result of this development the petrochemical industry would lose its market share for the sale of its end products, since also the maritime business is already transiting to LNG gas as a fuel for its ships, replacing the current fuel in most MFO driven vessels.
Moreover for an investment amounting to such a large sum, the required period to gain the return on such investment, would vastly exceed the period of time still available to the petrochemical branch of the fossil industry to remain profitable in a dwindling market, taking into consideration the fierce competition among the refineries still in operation the coming 20 to 30 years.

It is incomprehensible why the Government of Curaçao clings to the tunnel vision that the Isla has to be modernized to provide for employment opportunity, whereas such employment opportunity could more easily be achieved by developing the Bullenbay seaport under its own management and control. Besides, it would certainly entail the necessary spreading of risk by allowing a diversity of investors to develop projects of small and clean industrial establishments on the hinterland at Bullenbay instead of the government’s clinging to a relationship of pure dependency on one single foreign entity. And developing the seaport lies fully within the power and possibilities of the Curaçao government, without having to depend on the willingness of one single multinational to invest in the petrochemical industry. Why then cling to such a tunnel vision?

GZE claims to have spent millions in preparatory work, but those millions were not spent on investigating the possibilities, as is being claimed. More likely those millions were spent to “buy” support in the Curaçao political arena for GZE’s intended objective, which is to draw the seaport at Bullenbay under its control.

The geopolitical implications are not to be disregarded either. The Government of Curaçao exceeded the bounds of its national
authority by concluding an international agreement of such magnitude and purport, since in implementing the agreement, the Kingdom of the Netherlands will lose a physical and strategic part of is territory to a foreign entity by the B.O.O. construction as envisioned for the construction of the LNG-terminal in the Bullenbay. Lately the MDPT has awakened to the fact that up to now GZE has succeeded in outsmarting the negotiators on the part of Curaçao. But the pitcher goes so often to the well that it comes home broken at last. And certainly the soap bubble of the Guangdong dream has finally burst.

By Marguérite Nahar 

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