Chile's government wants to make state-owned oil and gas company Empresa Nacional del Petroleo SA, (ENAP) economically viable through a management overhaul and streamlining of production.
In the first nine months of the year, ENAP posted a 15 million USD net loss as its Aconcagua and Bio Bio refineries suffered extensive damage and temporarily halted operations because of a massive February earthquake.
ENAP which managed to turn around a 958 USD million loss in full-year 2008 by posting a net profit of 242 million in 2009 has nearly 4 billion USD in accumulated debt.
We want to give the company good corporate governance that will guarantee us that we can avoid past situations, in which the company ended up with debt of 4 billion and it had poorly managed projects said Raineri.
ENAP reliance on debt drains the company as it must make interest payments of nearly 200 million USD per year, Jorge Matute, the head of ENAP union umbrella organization, recently said.
The company is in the process of reducing costs by cutting 530 workers, or about 15% of its total 3,380 workforce.
We want to watch over the development of this company...so that it's an economically viable company and it complies with its objective, which is to contribute to the development of the nation's energy sector said Energy Minister Ricardo Raineri
The planned changes which include a more professional board, require legal changes that must be approved by the country's parliament, pointed out Minister Raineri.
Enap supplies about 80% of Chile's fuel needs and exports refined products to Peru, Ecuador and Central America.