Published: July 24, 2013
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After discussing the proposed HOVENSA agreement for 12 hours on St. Croix on Monday, the 30th Legislature took the show on the road to St. Thomas and took up the issue again Tuesday night.
The Committee of the Whole took testimony from a handful of residents on both islands on the proposed agreement that would govern how HOVENSA would go about trying to sell the refinery over the next year.
Senators also called government and company representatives back to testify on Tuesday, putting them on late in the evening and giving them an opportunity to update or clarify their testimony from the previous day.
George Dudley, local attorney for HOVENSA, PDVSA V.I. and Hess Oil Virgin Islands, took that time to respond to senators who have suggested sending the government back to the negotiating table, or who have questioned why the government was negotiating at all with a company that they said had breached the existing agreement.
Dudley said the companies contend they have not breached the agreement at all.
He also suggested that if the proposed agreement is not ratified, litigation will come. And he said that the litigation would keep the issue tied up in the courts for years.
"The question is stark: Do you want to have a refinery on the island of St. Croix or do you not?" Dudley said. "That's the question before you."
He said that if senators do not ratify the agreement, that would guarantee the departure of the refinery from the island and ensure litigation.
Dudley noted that senators had been spending a lot of time focusing on the mistakes of the past, talking about problems they had with previous HOVENSA agreements.
He told senators they could do that - or they could take a positive view and look to the future, armed with the knowledge gained from the mistakes of the past.
Some senators later called him out on his statement, saying it was offensive or arrogant.
Dudley said he did not intend to be arrogant, but was trying to convey his clients' position.
The issue of the proposed agreement has been contentious, with some senators pointing out what they view as flaws and problems with the provisions of the deal, saying they dislike the structure of the agreement or think the territory gave too much away. Some have made suggestions for renegotiating.
The Senate's role in the matter is to vet the agreement and take up the question of whether or not to ratify it.
The January 2012 decision by HOVENSA to shutter its refining operations and convert to an oil storage terminal led to negotiations between the company and the V.I. government, because that type of change in operations required revisions to HOVENSA's 1998 concession agreement with the government.
The proposed fourth amendment agreement between the Government of the Virgin Islands and HOVENSA lays out responsibilities and governs how the company would go about attempting to sell its shuttered refinery on St. Croix's South Shore.
The proposed amendment agreement would allow HOVENSA to continue to operate as an oil storage terminal while it is up for sale.
The parties to the agreement are HOVENSA, Hess Oil Virgin Islands Corp., PDVSA V.I., Inc. - the two companies that each own 50 percent of HOVENSA - and the V.I. Government.
Not surprisingly, the territory's two Chambers of Commerce came out in support of the deal, as did St. Croix gas station owners.
The St. Croix residents who testified Monday night either urged extreme caution with the deal, or opposed it outright.
St. Thomas resident Stephanie Scott-Williams raised her concerns on Tuesday night.
She asked why, when "we try to do the right thing for the territory," it becomes politicized.
She also voiced a number of questions and concerns she had about the deal, and compared it with the government's deal with Diageo.
"It tastes like Diageo - bitter," she said.
St. Thomas resident Caroline Browne talked about the health issues she feels stem from the proximity of the refinery, and said the territory was a shambles from the refinery's 40 years here.
"How you going to tell me you going to get people jobs when they're dropping down dead from asthma, from cancer, from bronchitis?" she said.
Also testifying Tuesday was local attorney Jennifer Jones, who said she represented a company interested in purchasing the shuttered refinery.
The company, Calumet Specialty Products Partners, LP, is a producer of specialty hydrocarbon products and fuel products in North America, according to information presented to the Senate.
The Indianapolis-headquartered company has facilities in Louisiana, Wisconsin, Montana, Texas and Pennsylvania.
According to testimony, the business is organized into two segments: specialty products and fuel products and has significant refining experience. Calumet has ideas for specializing the refinery and making it profitable and sustainable, according to information presented to the Senate.
At this point, the company has expressed interest, but it has not even toured the HOVENSA refinery yet, according to Jones.
Tuesday's hearing again lasted well past midnight.
The 30th Legislature is scheduled to vote on the question of ratifying the proposed agreement on Aug. 7.