State of limbo
Nearly a year after the government signed a questionable agreement with the principals of Oban Energies for a controversial $5.5 billion oil refinery and storage facility for East Grand Bahama, negotiations have yet to start on a revised deal and the new president told National Review they are unsure specifically what the Minnis administration wishes to see changed.
Reporters also failed in an attempt yesterday to get Prime Minister Dr. Hubert Minnis to talk about Oban as he was in Grand Bahama for a Cabinet meeting. Minnis said the projects that were to be discussed at that meeting were projects that he knew would work for the island, and he was not going to be talking “nonsense”.
It was an inelegant way of saying Oban was not on the government’s radar during the Grand Bahama visit.
Labour Minister Dion Foulkes said, however, the government hoped to soon settle with Oban on a date for the talks.
The new president, Alexander Grikitis, recently replaced Satpal Dhunna. He said Dhunna was tending to certain family obligations and is still a shareholder in the company.
Grikitis, who was in Nassau a few days ago, said he too hopes the negotiations will soon start and acknowledged there were also “missteps” on the part of Oban ahead of the signing last February.
That signing set off a firestorm.
Grikitis pointed to inadequate communication with the public as a key misstep.
“Of course, it’s frustrating, but you know, I think there were mistakes made on all sides,” he said. “I think if we can work together [we can] kind of start on a new slate and move forward.”
Grikitis said he gets calls from people in Grand Bahama just about every day asking when the project will start.
“I want to be able to say ‘we’re moving forward’, but right now we can’t say that yet, so I think it’s frustrating, but I’m hoping that now we can get a meeting going and move on to the next step.”
Foulkes said last month the government wants to renegotiate “the economic provisions, the environmental provisions and the legal provisions” of the deal.
While Grikitis, who was previously managing director of operations, insisted the 2018 heads of agreement was a “good deal for everyone”, he indicated that the company is open to changes.
Many of us agree, though, that the deal was not good for the Bahamian people.
Presumably the government did as well, which is why it plans to renegotiate.
Grikitis said, “I think it’s premature to speak to that at this point. We’ve agreed to come back and meet with the government and see what they are asking us to amend or do an addendum to, but at this point I think we kind of need to go through and see what they’re specifically requesting. We have generic questions from them, but not very detailed, and I think we need to get into the details before I can answer what they’re asking for.”
One of the provisions that angered and alarmed many Bahamians was a clause that locked the government into the deal, even if the environmental impact assessment (EIA) determined the project would harm the environment.
The agreement said, “The parties agree that the government shall not have the right to terminate these heads of agreement based upon any EIA report, but instead shall work with the developer to mitigate any concerns. If the government does not provide any such comments to the EIA within (a) 60-day period, the EIA shall be deemed acceptable to the government.”
The EIA has since been completed, but neither the government nor Oban is making it public as yet.
Asked about the EIA’s findings, Grikitis told us, “I’d like to wait until the government reads through it [and] do all their investigation [to determine] that we’ve hit all the points that we’re supposed to.
“It took us longer than we wanted to take originally because we went above and beyond and we had some meetings in between with the government, and they had some suggestions for us. We listened to those suggestions and we implemented [them], so I think they’ll find it very satisfactory and even more satisfactory than they originally thought.”
Grikitis claimed the Oban project would have less of an impact on the environment than most hotels.
“I was a green real estate developer,” he added.
“I actually [had] my employees go to LEED certification training school prior to it really being a big thing in the United States and so, from an environmental standpoint, I’m very much about the environment and researching that. I’ve been coming to The Bahamas from four years old.
“I think when it comes out from an environmental standpoint, people will see that we’ve done our homework, we’ve done our research, we have the best practices put in place and I think this terminal will set a standard for other terminals around the world of the best environmentally built terminal that could possibly be built.
“I think when we’re really able to get into it [we’ll be able to] explain to people more after we meet the government, what we’re doing and how it’s not as much of an impact as people think it is. I think a lot of people will kind of rein in their fears a little. We don’t plan to move forward without the Bahamian people, the government, everyone being comfortable with what we’re doing.”
While no renegotiations have started, Grikitis is hopeful that the company will be able to secure permits for its project as early as the end of March, but he acknowledged that his wish might not necessarily square with reality.
He said the priority would be to send Bahamians off to train in the engineering field to maximize their use on the project. It could take another 12 to 18 months after security permits for construction to start, he noted.
Grikitis said Oban intends to work hard to correct what he said has been a lot of misinformation about the project.
“A lot of people thought we were drilling. We’re not drilling. A lot of people thought we were on top of national parks. We’re 13 miles away from a national park…[we’re] nine miles away from the nearest town,” he said.
“I think explaining that to people and explaining that today you can’t access that beach but we’re going to open up access to that beach. Our pipes aren’t going on the beach. They’re going underneath the beach, so that beach will actually be opened in the future for Bahamians to be able to utilize, which today it’s not open for Bahamians to utilize… We’re not trying to hide anything. We’re just trying to do it the right way and we don’t want to misstep by saying the wrong thing before making sure we’re in the guidelines of what’s going on.”
One of the things that made the signing on February 19, 2018 so controversial is that Peter Krieger, at the time Oban’s non-executive chairman, signed on behalf of the company, but did not sign his own name. He signed “Satpal Dhunna”.
After the signing, a zoomed-in Nassau Guardian video showing the fake signing went viral, heightening the controversy in the process.
The government later claimed the signing on that date was merely ceremonial and that the heads of agreement had already been privately signed.
We asked Grikitis whether Oban knew the signing was ceremonial at the time.
“It was a ceremonial signing we were told,” he said.
“We were told it was one camera in the room, handshake, ceremonial signing. Everything else was already previously done, executed. There was a witness to that as well so I’m not scared to say that… When we walked in the room there were way more cameras and people than Peter thought, and I don’t think Peter realized he was signing Satpal’s name, truthfully. No one was expecting to walk into a room full of cameras and people.”
We wanted to know whether Grikitis was suggesting that Krieger somehow had a mental lapse as he signed.
Attorney Gregory Cottis, who represents Oban, interjected, “Peter is Peter”.
Grikitis then said, “I don’t think any of us knew what was going on in his head.”
Last March, the prime minister told Parliament that Krieger was no longer Oban’s non-executive chairman.
Grikitis confirmed that Krieger is out, but said his in-laws are still shareholders in the company.
The company’s decision to allow Krieger to sign in the first place was unfortunate.
The Bahamian media soon revealed that he pleaded guilty to the first-degree felony of organized fraud in 2006, according to a document on the U.S. Securities and Exchange Commission’s (SEC) website.
The order, dated July 3, 2007, made “findings and imposed remedial sanctions” on Peter Krieger and his father, Sheldon Krieger.
In the wake of the Oban firestorm, which is not yet completely out of gas, the company is still trying to sanitize its image.
The new president expressed confidence that Oban will be able to win Bahamians over.
“I think as long as you execute properly and you live up to what you say you’re going to do, I think as long as we do that and keep pushing forward it will change, and hopefully the negativity will go away and we’ll have positives and we’ll have jobs. We’ll have [an] economic boom into The Bahamas and hopefully it works out for everyone,” he said.