CMB BD

Tatitan – A Gaiden Called Butthurt PART TWO: Raw Deal

Tatitan – A Gaiden Called Butthurt PART TWO: Raw Deal
Top Ads
Top Ads
Top Ads

Ah, butthurt. The Internet’s ultimate expression of its cognitive dissonance. As a rule, it should never be responded to directly, lest one feed the trolls and become the source of their lulz. But that doesn’t mean it can or should always be ignored. Just look at Venezuela. Hugo Chavez scored his country’s presidency despite his overt disregard for democracy (as demonstrated by his failed coup d’état years before) and the people who supported him clearly did so out of pure butthurt. So much butthurt in fact, they not only let him expand his executive power, but they also let him gain influence over the legislative & judicial powers as well, thus eliminating the checks from the balances and making himself a de facto absolute ruler. Pictures, posters and paintings of the man started to appear everywhere not long after that, as one would expect in countries that begin to get that totalitarian aftertaste. So how about the here & now? What makes Tatitan’s patriotic hemorrhoids flare up? Well sit back, grab a drink and bare (the pain) with me. We’ll have to do this in parts.

 

PART TWO: Raw Deal

Of all my rear-afflictions, truly the CITGO deal is the one that most urgently requires dissertation. First of all, isn’t it irritating how the agreements still haven’t been published or leaked or whatever? Some connected people have been allowed to take a peek, but that’s it. Even weeks after parliament almost unanimously ratified it. That really does give the impression that there’s something to hide. Is the government still obliged to keep things confidential? If so, why? It’s not standard industry practice to be this opaque, especially not when the project in question is to be financed externally. And if secrecy is not required anymore, how hard can it be to scan some paper and putting it online for everyone to see? Why aren’t the parties in opposition bitching about this? I can hardly wait to study the documents and marvel at the alchemy the Aruban team and the Venezuelans employed as they tried to contractually turn insanely risky shit into manageable gold.

 

Next to the non-transparency of the deal (even CITGO’s American execs weren’t familiar with the details), there’s also the government’s intentional obfuscation of it. Whenever the Prime Minister is put on the spot with respect to the doubts surrounding the financing of the deal, he cops out by praising the U.S. based refiner as a financially sound partner. His number crunching flunky Richard Arends naturally plays along, even assuring the press that, according to the rating agencies, a possible default on PDVSA’s bonds wouldn’t necessarily affect CITGO. All this BS blatantly insults not just my intelligence, but the Aruban intellect in general.

 

By now, everybody who cares to know is well aware of the fact that ‘CITGO the refiner’ is not in any way involved with the financing of this deal. We can know this for a fact, because CITGO’s been utterly cash squeezed and pawned out to PDVSA bondholders already. Besides, Fitch recently (October 28th) affirmed its rating for the CITGO bond under the assumption that the American refiner would neither give away any significant guarantees, nor exceed the US$300 million capital expenditure (capex) ceiling it announced at the beginning of the year, back when CITGO’s American execs were still kept out of the loop.

 

That Fitch had been holding the above mentioned assumption since February and never changed it even after the announcement of the deal confirms what everybody paying attention suspected when the organogram of the corporate structure resulting from the deal was presented mid-year to parliament. This organizational chart clearly shows the entire Aruban operation being fully separate from the American refiner (which is attached merely via a service agreement) and falling under a separate, so called ‘CITGO Aruba Holding’ company, which seems to be the one charged with the ludicrous task of procuring US$600 million worth of funds to invest over the next years.

 

A risible notion once it’s considered that this holding holds no assets right now and will not own the infrastructure in the future (‘cause Aruba does, right?). With a cash strapped parent company that according to the experts and by own admission will have trouble paying back its debts, but without having some big asset to put up as collateral for a loan, Minister Bermudez’ firm denial of any guarantees made by the government to back the holding’s financing only serves to validate even more the need for a straight answer on the question that for the longest time has been on the tip of every rational, independent Aruban’s tongue: just where the fuck are they gonna get the money from?

 

So, contrary to the PM’s cop-out, the CITGO deal has got that ‘CITGO’ in name only and the question remains valid and unanswered. We’re in the middle of freaking November for heaven’s sake and we’re still wondering what happened to the economic boost for this year of 237 million florin that the Central Bank was grossly overestimating in April and again in September. This shows that the government has been selling us a raw deal practically all year long. And it truly is a raw deal in every sense. It’s not just the bankrolling of the restart. All the other features, like the gas pipe, the solar park and the algae technology require additional financing (the 5 million agreed upon pays only for an algae pilot program, not the real thing). There are still a lot of hurdles to be cleared before anything can come to fruition but the authorities tout the unrealistic growth as a fait accompli.

 

Then there’s the raw deal we’re giving future generations with this restart. The government’s total lack of fucks given about their accountability with respect to the environment is perhaps best illustrated by Minister Dowers (IMHO, the one in that bunch that REALLY don’t give a fuck about anything), whose reaction to Raad van Advies’ (the island’s State Advisory Council) concerns about the clean-up at the end of the lease was:

Het Land en RDA hebben geen enkele contractuele verplichting jegens CITGO om milieuschade ontstaan gedurende de Pre-CITGO-periode te herstellen. De vergelijking, die de Raad daarom maakt met de geschatte kosten van herstel van milieuschade van de raffinaderij op Curacao ad Afl. 1,5 miljard is daarom onjuist. RDA zal wel namens het Land het Milieufonds blijven aanvullen.”

 

Wow, how’s that for a dumb, cold hearted cop-out? Zero fucks given. As in the first CODED LANGUAGE gaiden, I won’t translate to English here, lest I be accused of putting words in the man’s mouth. But I will say this: the whole point of our Advisory Council making the comparison between Curacao’s case and ours is to give us all (not just our leaders) an idea of the magnitude of our responsibility to not just our progeny, but to our piece of rock sticking out the Caribbean Sea. Feeling that responsibility is what makes the rock yours.

 

It matters not whether the environmental impact of nearly a century of oil industry on the island will amount to 1.5 billion florins as in Curacao, or one billion dollars like Minister de Meza once so expertly declared (remember that?). What matters is that it doesn’t seem, from what can be observed, that enough money will be made from the deal to absorb this social cost. And so like the generations before us, we mentally spray-paint gold over the shitty parts, turn the frown upside down and pass the responsibility on to our children, along with our debts.

 

This is especially true if the authorities simply use the monetary benefits of the deal to continue their overspending and the national budgets for 2016 and 2017 (an election year) seem to indicate that. In fact, the government’s insanely risky reliance on this thing to cover its short-term financial holes prompts me to picture the situation like Raw Deal, that old Arnold Schwarzenegger movie. In that movie, Arnie is an outcast who’s been given a chance to come back in the Game. He goes undercover and uses his street-smarts to get connected, infiltrate and exact revenge on those who had killed his career.

 

Imagine MEP bringing Glenbert back in the Game to be the rogue on number 30. He uses his street-smarts to infiltrate parliament and old oil connections to set up this deal, like he claims he did. He knows the deal is bogus, but also that Mike & Mike would eagerly jump into it because it could potentially save them from making anymore “adjustments” they would have to answer for politically. Once they stand firmly on the deal, it gets pulled from under them by –oh, you know- reality, leaving them with feet in the air and professor Bakker looming over with the bill in his hand. There’s an old Klingon proverb about revenge, how does it go again?

 

Don’t believe me? Well actually, there must be some truth to this joke. The entire MEP fraction sheepishly rallied behind son of the Liberator on this issue, voting pro this insanely risky shit and even quoting Betico’s BS rhetoric from 30 years ago, as if it bares any relevance to economic reality today. But at the same time you got former leader Nelson Oduber heavily criticizing the deal, mainly from the environmental angle, like he’s heard all about heavy crude upgrading before. Hmm, ask Andin. In Santa Cruz, only the ‘cabritos’ are dumb. And some of them are only acting the fool.

 

PART TWO AND A HALF: Dear Dutch Reader

Thank you for coming so far with me. I say this, because this much attention span is rare nowadays and it should be cherished. Don’t take the title to your ass, dear Aruban reader. That YOU are reading this much is rarest, so I cherish you the most. It’s why I always leave the meat for last. Now for dessert, I’d like to offer you a hypothetical answer to the question of where the fuck are they gonna get the money to finance this deal. ROSNEFT, the jolly Russian oil giant. Russia’s the largest foreign player in the Venezuelan Orinoco and the deal specifies that third parties can step in and we would have to give them the same terms as CITGO. Saying no could potentially cost us 300 million dollars, at least.

 

The best part is that Rosneft wouldn’t have to actually do anything or spend any money, if the goal of this state owned oil company, as an instrument of Russian economic diplomacy, would be to tease the Kingdom’s fanny. Just expressing interest in a joint venture with the CITGO Aruba Holding could disrupt things, as just the thought of having to play nice with Putin is enough to nauseate any Dutch politician. How about you, dear Dutch reader? Are you triggered?

Top Ads
Top Ads
Top Ads

About The Author

Related posts

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.