(Trinidad Guardian) NiQuan’s founder and chief visionary officer Ainsley Gill has written to bankers, noteholders and financiers saying that if the Gas to Liquids (GTL) plant does not get urgent funding it will be forced “to cease operations and send home all employees”. The company has more than 70 workers.
Employees told the Sunday Guardian that they have been furloughed until November and have not been paid their August and September salaries and are concerned whether they will be paid for October.
They also expressed concern that their National Insurance (NIS) payments and Pay As You Earn (PAYE) are not paid up to date by the company but were deducted from their salaries.
Employees shared an email with the Sunday Guardian in which they queried the matter with the Human Resources team.
“The company has, and always has had, every intention to pay and resolve this matter fully with the Inland Revenue and The National Insurance Board and has been liaising with them continuously. For information, in no way would any employee be personally held responsible to settle any shortfalls owing Inland Revenue, that onus is on the company through the PAYE system as are incurred penalties,” a letter signed by HR to all employees stated.
The letter noted that the outstanding debt was supposed to be settled on the attainment of the Commercial Operations Date (COD) which has not yet been achieved.
“As a direct result of not obtaining COD and other plant issues since 2021, the company has been instructed by its lenders on what the company can utilise their funding for, and cannot use their funding for anything other than what is approved. They are also fully aware of the situation. We now have legal claims against Upstream Downstream and the GORTT, which was never expected, and which could take some time to resolve, so we do not have date certainty to provide at this time.
“Once the legal cases are resolved and damages are obtained, then the company will pay the full amounts owed to the Inland Revenue and The National Insurance Board to resolve the matter,” the letter said.
Employees told the Sunday Guardian that some have sought legal advice on the matter. Last week, they said, the company held a virtual meeting with staff and “was actually encouraging us to seek employment”.
“They just told us and gave us personal letters, we had no choice,” one employee said.
In a letter dated September 21, 2023, Gill wrote to noteholders explaining: “The company has tried to raise new equity funding through a recent cash call to shareholders with limited success. We are therefore compelled to give notice that absent funding of the budgeted amount, regretfully and sadly NiQuan will within the coming week be forced to cease all operations and send home all employees.
“Further, stemming from NiQuan Founding Chairman, John Andrews statement in the media and the positive feedback, Mr Andrews will be reaching out directly to the Prime Minister for an urgent meeting next week to discuss with a view towards a resolution.”
In his letter, Gill explained that the plant was now in “silent mode” and that funds were needed for “certain necessary and critical payments which must be made now including monthly insurance premiums to avoid cancellation of the OCIP Insurances and physical security for the plant”.
He said that critical payments include salaries, overdue electricity charges to avoid disconnection by T&TEC, procurement of certain consumables to maintain the catalysts and other vital parts of the plant and payment of judgment debts to avoid commencement of enforcement action by creditors, including the continuation of a winding up petition lodged by Southern Supplies Limited and which had been stayed while certain instalment payments were being made to them.
He said that the three-month budget needed immediately was US$2,576,575. Of this amount, the insurance of US$483,399 which is due and the physical security vendor cost of US$200,000 are mandatory for all regulated energy plants.
The Sunday Guardian understands that the 21-day stay on the $20 million judgment in favour of former vice president David Small has passed and his lawyers have written to NiQuan demanding full payment or they will seek to wind up the company.
NiQuan declined to comment to the Sunday Guardian.
Legal battles ahead
In his letter to noteholders, Gill said NiQuan had held discussions with the Trinidad and Tobago Upstream Downstream Company (TTUDEOCL) and would agree to negotiate another contract if US$10 million of the US$21 million debt was paid upfront.
The Sunday Guardian understands that while NiQuan has sought to engage the Government informally, there has been no meeting between the Government and NiQuan because it is a commercial contract between NiQuan and TTUDEOCL.
The Sunday Guardian understands that to date, NiQuan has made no payment to TTUDEOCL.
Furthermore, the company has not yet been given clearance by the Ministry of Energy and Energy Industries (MEEI) to restart operations following the June 15 accident at the plant which subsequently led to the death of 35-year-old pipe fitter Allanlane Ramkissoon.
Gill told noteholders that NiQuan’s Board and executives have been trying to seek an amicable resolution with the Government.
He said that “failing a fair and reasonable and commercially viable compromise” being reached with TTUDEOCL, NiQuan would pursue different legal strategies: (1) the Appeal for the mandatory injunction against UD and declaration against GORTT, (2) the filing of a Request for ICC Mediation, and (3) the commencement of the substantive claim under ICC Arbitration”.
He said that the appeal on Justice Kevin Ramcharan’s August 21 decision which denied NiQuan an injunction to compel the State to supply natural gas to the plant was filed on August 29 and NiQuan’s written submissions settled by Stuart Isaacs, KC, were submitted on September 19. He expects the matter to be heard by early November.
“Alternatively, if NiQuan does not get gas back to the plant, NiQuan will pursue all legal recourse and claim for damages and loss profits from which proceeds to all Noteholder will be paid, albeit a bit more protracted over 18–24 months. NiQuan and its legal advisers are of the view that it has a strong case,” he said.
He noted that NiQuan is currently awaiting clearance from the MEEI pending the completion of their investigation.
“NiQuan expects that the investigation would be given priority for completion, given the importance of the incident and high public interest. Based on the MEEI investigation outcome, it is anticipated that NiQuan would be notified of any start-up dependent actions and given an opportunity to address the same,” he said.
He blamed the Government for where NiQuan presently stands.
“One could not have expected that the GORTT would renege on its Cabinet decision and undertaking to ensure that the plant received a guaranteed supply of gas from the Minister’s Share/Government Natural Gas, though UD, that was not subject to availability, curtailment of use of reasonable endeavours. The NiQuan suite of project agreements are clear and unequivocal, and the gas sales contract is what all investors relied on to make their investment, and it is the jewel in the crown that creates the value for all,” he said.
Management change
Meanwhile, in a bid to salvage the investment, financiers have been trying to move Gill from the helm of the project. However, Gill is the largest shareholder of the company.
But financiers, who have pumped hundreds of millions into the project, believe that Gill’s legal battles with former executives have cost the company from a reputational perspective.
To get Gill out of the project, NiQuan’s noteholders have to agree to such a move.
NiQuan was set to refinance its bonds for US$300 million ($2 billion TT) by July 31 but the accident set it back.
NiQuan owes hundreds of millions to financiers in T&T—among them banks and credit unions and investment companies. Even the Government, through Petrotrin, has preference shares in NiQuan.
NiQuan raised money on the international bond market, loans and sums from local investors which include Republic Bank Limited, RBC Trust (Trinidad and Tobago) Limited, Beacon Insurance Company, Firstline Securities, Prime Capital Limited, JMMB Securities Limited, Waterloo Capital Advisors, KCL Capital Market Brokers Limited, Inshallah Investments, Farm Chem Engineering Management Limited, GM Homes Limited, M&J Services Limited, Central Finance Facility Cooperative Society of Trinidad and Tobago Limited, Petrotrin and Washington DC registered, Niquan Energy LLC.
On September 22, NiQuan’s chairman John Andrews, in a newspaper advertisement, asked the Government to uphold the “sanctity of contract” even though no contract exists between the company and the State.
- The directors of NiQuan Energy Trinidad Ltd, as of the company’s 2022 annual return, stamped on August 15, 2022, are Andrews, Alison Lewis, Nicholas Galt, Larry Felix and Gill.
