May 2017 Financial News

PM: Venezuela gas deal progressing

May 31, 2017

Prime Minister (PM) Dr Keith Rowley says “discussions are moving apace” on the historic energy agreement between Trinidad and Tobago (TT) and Venezuela.

“Discussions (on) the supply of gas to TT from Venezuelan gas fields and the development of cross-border gas fields...are moving apace and we anticipate early execution of the required agreements to facilitate the production of natural gas from these fields.” Rowley made the announcement yesterday while addressing a breakfast meeting with the Chilean Energy Sector at the Federation of Industry (SOFOFA) in Santiago, Chile. The PM was in Chile on an official visit and is expected to return home today.

The prime minister did not provide SOFOFA members with a projected start date for shipment of Venezuelan gas to TT, however on March 16, while speaking at a post-Cabinet news conference, the PM had expressed optimism that a gas sales agreement would be reached “by July of this year.” A Government-to-Government Agreement was signed in Caracas on December 5, 2016.

Then, on March 15, 2017, a Heads of Agreement (HoA) was signed by the National Gas Company of TT (NGC), Venezuela’s state oil and gas company, Petroleos de Venezuela SA (PdVSA) and international giant, Royal Dutch Shell.

This allows the companies to work together on the delivery of natural gas via a pipeline that will run from Venezuela’s Dragon gas field to the Hibiscus Platform, owned by Shell, on to land at Trinidad’s Point Lisas Industrial Estate where the gas would be processed and sold. TT is to be given priority in purchasing the gas.

While this is one of several projects expected to bring this country’s gas supply back to normal levels, Rowley yesterday said TT “needs to stimulate an aggressive exploration programme” because to date, exploration activities have been limited to one-third of our land and marine acreage.

“Of the remaining two-thirds, approximately 75 percent of the unexplored acreage is in our East Coast deep-water area, where recent exploration activity has identified a significant prospect and will be subject of six exploration wells in the 2017 to 2018 period.” “This area has been compared with the Guyana-Suriname Basin located to its south-east and Ghana’s Tano basin, where there have been several large oil and gas discoveries. The un-explored acreage on land and marine areas represent a valuable resource to be exploited.” Hence the Ministry of Energy’s recent invitation for nominations for blocks onshore, in shallow water and in the northern and eastern deep-water blocks.

“Companies can indicate which unlicensed areas are of interest during the six-week nomination period, which closes on June 30, 2017. The selected blocks will be included in a proposed 2017 Competitive Bid Round. In parallel with this exercise, the Ministry of Finance is undertaking a review of the fiscal regime with the intention of structuring a regime that is amenable to all stakeholders,” Rowley said.

Praising Chile for its reputation for being “a very energy efficient country”, the PM said TT can learn from the South American nation’s experience in energy efficiency and renewable energy.

He highlighted Chile’s Energy Policy, in accordance with which, it is anticipated that by 2050, renewable energy will contribute at least 70 percent of electricity generation in Chile.

Speaking about “the fledgling stage of development of(TT’s) renewable energy resources”, Rowley told SOFOFA about his administration’s target of achieving ten percent renewable power generation by 2021.

“This will require the development around 150 MW of renewable energy resources. As part of the strategy to attain (this) target...we have also embarked on a Waste to Energy Project, which will also contribute to the modernization of the Integrated Municipal Solid Waste System in TT.” SOFOFA members also heard about Government’s commitment to “the promotion of energy efficiency, and renewable energy sources, including wind and solar, as the means to increase our energy security and reduce our reliance on fossil fuels.” “In keeping with our policy it is our intention to maximise, where practicable, the use of renewable energy such as solar and wind through incentives, concessions and enabling legislation, and make the reduction of TT’s carbon footprint a priority by setting appropriate renewable energy production targets,” Rowley stated.

Source:
Sasha Harrinanan
Newsday
Wednesday May 31, 2017

http://www.newsday.co.tt/politics/0,244381.html