Faced with a precipitous fall in crude prices State-owned Heritage Petroleum has decided to store its oil rather than sell it at record low prices .
This means the company will for the time being stop exporting oil.
Highly placed sources tell Guardian Media that the State-owned enterprise has the ability to store its present production for up to two and a half months and would prefer wait it out, hoping for better prices, rather than export at half what it is cost to bring a barrel of oil to the surface.
Oil futures have crashed and crude is selling at US $13 a barrel, the lowest in more than two decades.
It costs Heritage US$25 to produce a barrel of oil according to Energy Minister Franklin Khan who recently made the revelation on CNC3’s business show.
Sources at Heritage reveal that the company has been producing 41,000 barrels of oil per day and it has storage capacity to hold three and a half million barrels.
As a result it will not be exporting and the company will rely on its cash on hand to pay its bills.
Oil prices have crashed as demand has plummeted due to the COVID-19 pandemic.
Multiple sources at Heritage tell GML that the hope is that demand will pick up in the next sixty days, and with it global prices, as world economies start to reopen.
Heritage usually receives the price traded for West Texas Intermediate plus US $5 a barrel
Reporter: Curtis Williams