Mauritius State Trading Corporation (STC) was losing $115 per oil barrel in 2008-2009

A senior officer at the State Trading Corporation (STC) has said that the island was paying $161 per oil barrel when its price was reduced to just $46 on the world market.

Therefore, the organisation was losing $115 per oil barrel. This led to a deficit of Rs 4,739,000.

He added that the decision to opt for hedging was taken by former minister Mahendra Gowressoo. However, the latter said that when the decision was taken, it was Dr Rajesh Jeetah who was minister of Commerce.

The officer also informed that the decision to opt for hedging was taken on July 22, 2008 and the first cargo was delivered in August 2008.

It should be noted that Gowressoo assumed his duties as minister on September 12, 2008 and the country received the first cargo of oil in August 2008 at $161 while it was being sold at $126 on the global market.

The official added that former minister Gowressoo was in favour of hedging. “In July 2009, Morgan Stanley and Mitsui Co Ltd asked the STC to settle the dues and they contracted loans with several banks to repay the sum of Rs 4,739,000 towards the end of July 2009.”

The official added, “Consumers contributed Rs 3 per litre towards hedging losses. This amounted to Rs 100 million monthly towards the payment of the losses. The STC used the money to pay for the loss. Thus, it took us 50 months to pay the loss.”

The STC official said, “Gowressoo claims that the STC already paid the loss in 2009. If this is so, then why did he not withdraw the Rs 3 when he was the minister responsible for the STC?”