The local press created a controversy this past week when various media outlets inquired about the purpose of remaining “utilities” funds on the National Oil Refinery’s (RECOPE) 2008 financial statement, released earlier this year. Assuming that this figure represented profits made by RECOPE, a stateowned company, many questioned whether this money should be returned to consumers.
The issue was confused by the fact that on March 20 the Public Services Regulatory Authority (ARESEP) formally requested that RECOPE offer a refund to fuel consumers in the amount of ¢79 billion ($141 million) through reductions in the price of fuel, starting sometime between the end of April and beginning of May.
RECOPE addressed the media’s concerns on March 27 in a statement that said the refinery does not have or make any profits from fuel sales.
Rather, the amount listed under “utilities” on the institution’s 2008 financial statement, released in January, are allocated for maintaining a fuel reserve in order to avoid a lack of fuel supply for gas stations nationwide.
ARESEP spokeswoman Carolina Mora clarified that its request was not a response to this entry in RECOPES’s financial statement, but the result of an assessment of the refinery’s costs and expenses. This study, carried out by ARESEP in February, took into account the amount needed by the refinery to maintain a security reserve.
According to Mora, the study of RECOPE’s finances was carried out at the request of President Oscar Arias, as an element of his Shield Plan, aimed at boosting the Costa Rican economy. Arias requested the revision on Jan. 30, in order justify a possible fuel price reduction as an economic stimulus measure.
Mora agreed with RECOPE that the utilities stated on RECOPE’s report should not be considered profit but, rather, funds the institution could legitimately use towards keeping a security reserve. RECOPE must have a 30-day security reserve at all times.
The amount of the reserve varies according to the type of fuel, Mora told The Tico Times on Tuesday.
In its study, ARESEP also took into consideration international market conditions in order to justify its request for a price cut. ARESEP observed that during the month of February fuel price reductions in the international market were reflected in national fuel prices at the same rate.
ARESEP estimated that the implementation of the price reduction will mean that the price of gasoline super will be reduced by ¢35 ($0.06) per liter, gasoline plus will have a ¢38 ($0.07) per liter decrease, and diesel fuel will drop ¢59 ($0.11) per liter.
ARESEP will hold a public hearing on April 23 at 5 p.m., regarding the fuel price reduction proposal. The hearing will held via video conference, which can be seen at ARESEP’s local office in San José or the Heredia, San Carlos, Cartago, Puntarenas, Limón, Pérez Zeledón, Liberia and Bribrí courthouses.
After the hearing, ARESEP’s general regulator will have a month to make a final decision on the price reduction, which will be binding on RECOPE and its distributors throughout the country.
The international price of the barrel of crude oil fell to just under $50 this week for the first time since March 19, dropping by $3 on Monday (March 30), newswire Reuters reported.