How far will Mauritius default on Betamax and how much will Mauritians suffer?

How far will Mauritius default on Betamax and how much will Mauritians suffer?

December 11, 2017 0 By User

The government of Mauritius through its Trade Minister Ashit Gungah insists the country is not going to face fuel shortages, and one of the reasons given is that former DPM Shaukatally Soodhun negotiated supplies of oil to Mauritius from the Saudi Arabian oil giant Aramco.

But the real issue here is how far will Mauritius default on the payments to Betamax?

STCM in 2009 signed a 15-year contract with Betamax to transport fuels from Mangalore Refinery and Petrochemicals Ltd (MRPL) in the southern the Indian state of Karnataka to Port Louis. The contract was worth 8 billion Mauritius rupees ($238 million), Reuters said.

But in 2015 it terminated the contract with Betamax. The company won a case in June against STCM for premature termination at the Singapore International Arbitration Centre that awarded Betamax more than $120 million.

Does anyone know the real reason that pushed the MSM-PMSD-ML-OPR regime then under Sir Aneerood Jugnauth to terminate the contract illegally?

Can anyone also say how much will the people of Mauritius suffer from the final settlement of this error by a regime that took things for granted?

And why is there such a delay in the payments to Betamax? Sure, Mauritius do not have that kind of money, but would not have been wiser to talk directly to Betamax and settle the fine over a flexible period of time?

The Reform Party leader Roshi Bhadain accused the former government in the Betamax deal. He said the Betamax contract is illegal, explaining that the award did not follow the due process from the Central Procurement Board.

But they lost the case, does it mean Bhadain was wrong in his assessment on Betamax?

Bhadain was the minister of financial services and good governance during his tenure in the government.

Seriously, not a single soul seems to have an idea what is going on at the Government House with regards to the Betamax problem!

Many people are saluting Soodhun’s deal with the Saudis, but do they know that Betamax could act against the deal? And if they do, what will happen to the small Island’s people who will then be without electricity and fuel for Christmas and New Year?

Delaying the payments to Betamax any further will not help Mauritius, not its image on the international scene and will create more negative impacts for the country’s economy.

However, the government in place seems unable to deal with the problem, while it successfully manoeuvred with the Saudis to get oil supplies. But for how long?

The fuel issues stem from a dispute between the State Trading Corporation of Mauritius (STCM), which buys fuel from MRPL, and Mauritian-based shipper Betamax.

After winning its case in Singapore, Betamax pressed the case at the Karnataka High Court after STCM did not make payment.

A Karnataka court order reviewed by Reuters directed port authorities at Mangalore “to refrain from providing any clearance” to the tanker Pacific Diamond from leaving India with 40,000 tonnes of unspecified petroleum product for delivery to STCM.

The ship is to be held until the next hearing on the matter on Monday, the order said.

Betamax can enforce the arbitration award against STCM’s assets in any country where the award is enforceable, said Reuters.

MRPL exports about 1.2 million tonnes of refined fuels to Mauritius a year.

MRPL will look at exporting the surplus fuel if the ban continues on supplies to Port Louis, a company official said on condition of anonymity.

An MRPL spokesman declined to comment on the matter while Saudi Aramco did not immediately reply to an e-mail.