‘New fuel contract up by Monday’

The government believes that a new fuel contract with Mobil Oil Marianas would be signed on Monday.

Lt. Gov. Diego T. Benavente, who heads the government negotiating panel, said yesterday that a new contract is needed to ensure the delivery of fuel next week.

“We have to finish it by Monday because of the fuel that’s coming. It’s loaded and it’s on its way but we have to have a contract for it to be delivered,” said Benavente.

Mobil agreed to deliver 1.4 million gallons of fuel to CUC by June 2—the result of initial discussions following Gov. Juan N. Babauta’s May 19 state of disaster emergency declaration.

The fuel, reportedly loaded in Singapore on May 20 for Saipan, should be enough to run CUC power plants through the month of June, authorities said.

Meantime, Benavente said that both sides agreed during yesterday’s meeting to finalize everything on Monday.

“We just need to take care of some other stuff and go over it again by Monday,” he said.

He said there is just “a minor thing that needs to be addressed by the management.” He declined to be more specific.

The negotiations focused primarily on the settlement of CUC’s overdue to Mobil, amounting to $8.5 million. CUC incurred the debt over the course of its two-year contract with Mobil. Mobil reportedly wanted to get assurance that future fuel purchases would be paid promptly.

The emergency declaration came amid recurring power outages, caused by the CUC’s lack of fuel to adequately run its power plants, among others.

The governor, which currently controls CUC following the emergency declaration, said this move was necessary to ensure the continued provision of power to critical CNMI public health and public safety facilities, the continued provision of electricity to schools, homes, and workplaces, and the continued operation of the water and wastewater systems.

During this period, he can take all necessary measures to assume full control of the CUC and suspend all regulatory statute provisions and regulations applicable to CUC, including procurement regulations.

The governor’s emergency powers also suspended the CUC board of directors’ power, authority and responsibility.

At the same time, the governor has the authority to reprogram all funds to address CUC’s problems.