Written by Denis Scott Chabrol
Tuesday, 13 September 2011 18:51
Caribbean Aviation Maintenance Services (CAMS)- the lone aviation fuel supplier at Ogle International Airport- is rejecting accusations that it is engaging in price gouging.
Though part of the Correia Group of Companies, which includes an airline, CAMS debunks claims that it is part of monopoly to force airline operators to buy expensive fuel.
CAMS puts down Air Services Limited's (ASL) claim to an an apparent mixed up the prices for Imperial and US gallons in claiming that fuel was being sold at the Cheddi Jagan International Airport for GUY$1,200 compared to GUY$1,536 at Ogle and GUY$900 for direct imports.
Chief Executive Officer of the Correia Group of Companies, Michael Correia, referring to documents, pointed out that around August 12 CAMS had sold fuel at GUY$1,556 per imperial gallon while the price was GUY$1,467 at Timehri. CAMS noted that the price was US$1,221 per U.S. gallon at Timehri
“Having such a big difference and putting it out in the public gives the impression that CAMS has been gouging because why is it that they have to charge so much more than Rubis so that is a major area of incorrect information,” Correia told Demerara Waves Online News ( www.demwaves.com )
The CEO explained that the price of fuel at Ogle and Timehri is now the same due to ongoing lobbying with Chevron and its successor, Rubis, since May, 2011.,
While Chevron, he said, had argued that there should be competition between the two airports, Rubis has from September 1 agreed to give a further discount and harmonize the prices at Ogle and Timehri. They are GUY$1,465 per gallon for Imperial Gallon for AvJet and GUY$1,993 per Imperial Gallon of AvGas (GUY$1,219 per US gallon for AvJet and GUY$1,659 for AvGas).
CAMS pays OAI GUY$10 per gallon in handling charges for fuel. If ASL continues to import its own fuel, OAI will suffer “a substantial loss in revenue.” ASL consumes an average of between 20,000 to 36,000 imperial gallons of AvJet per month but that amount had fallen to about 18,000 in August when it started importing its own fuel, officials said.
Fuel prices at Ogle, he contended, are slightly cheaper compared to Suriname and St. Vincent and the Grenadines. OAI hopes that when more planes begin landing at Ogle from the Caribbean that the price would drop as a result of larger required volumes.
He also debunked ASL’s charges that the Correia Group--with a major stake on the board of Ogle Airport Inc and the umbrella company for Trans Guyana Aviation (TGA)—was using its position as a monopoly player in imposing high fuel prices on airline operators at Ogle Airport Inc.
“The airport is managed not by the Correia family but by two very experienced, well-respected aviation professionals. The regulations of the airport are actually written by those experts and they are vetted and approved by the Director of Civil Aviation so to say that the Correias are writing their rules is really quite laughable,” added Correia.
The CEO reiterated that OAI did not oppose ASL buying its own fuel but the “major concern” was safety.
“We are a little confused as to why they would not go through the process of applying to the airport. If they apply to the airport and the airport turns them down and say this is for Correia or CAMS, you can probably perhaps sympathize with a case of monopolistic control,” said Correia.
ASL’s Flight Operations Director, Annette Arjoon-Martins has, however, maintained that their fuel being purchased from the United States in ISO-standardized containers is safe for use by its aircraft. At the same time, OAI has been at pains to demonstrate to the media the arrival, storage, settlement, testing and three-time filtration of fuel before it is ready for dispensation from the fuel farm at Ogle to aircraft. The Guyana Energy Agency (GEA) also certifies the tanker to ensure that it has extinguishers and filtration systems while OAI grants airside access permits to the vehicle.
CAMS officials say the fuel farm fetches an annual insurance of US$7.5 million.
OAI’s fuel storage and delivery system is expected to undergo independent audits by airlines when the airport begins handling larger aircraft like those being operated by LIAT and Caribbean Airlines.
A senior ASL official had used its fuel tanker to ram open the Ogle Airport’s main gate after security there refused entry to fuel they alleged was not authorized to be taken there.
Government recently summoned a meeting of representatives of ASL and OAI, in an effort to resolve the issue. A decision is pending.