This content is from: United States

Trinidad & Tobago to probe Atlantic LNG's Transfer Pricing

Trinidad and Tobago are hiring international consultants to examine transfer pricing related to energy producer Atlantic LNG, Finance Minister Colm Imbert has told the Senate.

"We're engaging experts in gas pricing and international legal experts to look at the contracts for Trains I, II, III, and IV for the LNG plant and see exactly how our LNG is sold," Imbert said, according to a report in Trinidad & Tobago’s Guardian newspaper. 

Atlantic LNG is one of the world's largest producers of liquefied natural gas with 700 full-time employees.

Imbert said the government were concerned about pricing. He cited an example where LNG cargo might leave the islands for the US where the benchmark price for the cargo might be $2.80, but half-way through the journey the cargo is purchased and the ship heads instead to Europe or Asia where the price might be $3 or even $10.

"The person who gets the final sale of the cargo gets the benefit of the $10 price,” Imbert said, according to the Guardian. “There’s an argument that Trinidad & Tobago's revenue was being calculated on the lower price."

“Essentially they (multinationals) are selling it to themselves and then that entity unsells it to somebody else, so they really get far more revenue than they are reporting to us,” Imbert said. "But if you talk to the companies they say all of that is not true, all of that is mischief, lies and, therefore, the only way to deal with that now is to be scientific and professional about it."

Atlantic LNG did not immediately respond to a request for comment by TP Week.

The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms and Conditions and Privacy Policy before using the site. All material subject to strictly enforced copyright laws.

© 2019 Euromoney Institutional Investor PLC. For help please see our FAQ.

Instant access to all of our content. Membership Options | One Week Trial

Related