T&T is not like­ly to ex­pe­ri­ence de­clin­ing tax rev­enues from At­lantic, the Point-Fortin-based LNG com­pa­ny, as a re­sult of the low, pre­vail­ing price of nat­ur­al gas in the Unit­ed States mar­ket, says the new At­lantic chief ex­ec­u­tive, Nigel Dar­low. In an ex­clu­sive in­ter­view with the Busi­ness Guardian, Dar­low said he can un­der­stand peo­ple's con­cerns and to some ex­tent anx­i­ety about the mean­ing of the low US nat­ur­al gas prices and what that means for the coun­try's rev­enues from At­lantic. "The short an­swer is I don't see any im­pact of the low US prices on the At­lantic rev­enue stream," said Dar­low. He ex­plained that sev­er­al years ago, most of At­lantic's LNG car­goes went to the US, but in 2011 less than 20 per cent of the com­pa­ny's LNG ex­ports were des­tined for the US.

"We did not sell one Hen­ry Hub-based car­go in 2011. Our ex­ports to the US did not go to south­ern US. It pre­dom­i­nant­ly went to north east, Boston, which trades at a sig­nif­i­cant pre­mi­um to Hen­ry Hub," said Dar­low. "Eighty plus per cent of the car­gos went to non-US mar­kets such as Japan, Chi­na, Eu­rope and South Amer­i­ca, which trade at a sig­nif­i­cant pre­mi­um to Hen­ry Hub. So I think there is a bit of a mis­con­cep­tion-that link­age is not there now." He said the off­tak­ers (the com­pa­nies re­spon­si­ble for the sale of the LNG) have been very suc­cess­ful at di­vert­ing the LNG from the US mar­ket in­to much high­er-priced mar­kets. At­lantic does not it­self sell the LNG car­gos it­self. That is done by the off­tak­ers-BP, BG, Rep­sol, GDF Suez and state-owned NGC-who have rights to sell cer­tain amounts from the four liq­ue­fac­tion trains. The con­tracts which spec­i­fied the lo­ca­tions of the LNG car­gos have been var­ied over time as there was a recog­ni­tion that it was in every­one's in­ter­est that the gas be sold in more lu­cra­tive mar­kets.

"Our rev­enues are ac­tu­al­ly go­ing up and not down and there­fore the rev­enue that is be­ing pro­vid­ed through tax­es and the in­ter­est of NGC in Trains I and IV is go­ing up and not down, " said Dar­low, quick­ly adding, "And that is set to con­tin­ue." He said that he has spo­ken with in­dus­try ex­perts in the re­cent past and they all say the same thing: "LNG is a great busi­ness to be in be­cause if you look at the fu­ture de­mand for LNG, it is just out­strip­ping the sup­ply." De­mand for LNG is go­ing to out­strip sup­ply even if the ex­pect­ed sup­ply from shale gas sources around the world and new gas sup­plies from Aus­tralia and East Africa is added to the com­mod­i­ty's mix, said Dar­low. He said 247 mil­lion tonnes of LNG was pro­duced last year and that most in­dus­try com­men­ta­tors say that by 2025, the world will have to be pro­duc­ing be­tween 400 and 450 mil­lion tonnes of LNG a year. "The cur­rent projects un­der de­vel­op­ment are not go­ing to get you there, so sup­ply will con­tin­ue to strug­gle to match de­mand and will for many years to come, which is en­cour­ag­ing for a pro­duc­er and ex­porter of LNG," said Dar­low. This puts At­lantic and T&T in a good po­si­tion, he said.

In ad­di­tion, he said the de­vel­op­ment cost of new LNG fa­cil­i­ties is much high­er than it used to be, which will help At­lantic be com­pet­i­tive glob­al­ly be­cause it does not have the high de­vel­op­ment costs of some of the new plants. As a re­sult of all of these fac­tors, Dar­low said he has a very pos­i­tive out­look for both At­lantic and con­tin­ued rev­enue streams to T&T from the liq­ue­fac­tion fa­cil­i­ty. "I am con­fi­dent and I am pos­i­tive about the out­look, not on­ly for glob­al LNG de­mand-and de­mand will dri­ve prices-but al­so of At­lantic's abil­i­ty to com­pete. Peo­ple ask me: I have a very pos­i­tive out­look of the very bright fu­ture." Dar­low ex­plains that At­lantic is an op­er­at­ing com­pa­ny, which runs the four-train com­plex in Point Fortin for the five share­hold­ers, the newest be­ing a Chi­na In­vest­ment Cor­po­ra­tion, which ac­quired the GDF Suez stake last year (but not its off-take rights).

He says At­lantic re­ceives a pay­ment on each car­go that leaves T&T pays cor­po­rate tax­es on its in­come like any oth­er com­pa­ny and al­so pays div­i­dends part of which are dis­trib­uted to NGC. Dar­low, who is 45, has kept a low pro­file since he ar­rived in T&T just over a year ago to work close­ly with Derek Hud­son, who runs the British Gas op­er­a­tions in T&T. Trained as a lawyer, he was born in Read­ing, a town di­rect­ly west of Lon­don and has been work­ing in oil and gas for about 20 years, first with a law firm and then with British Gas. His last job be­fore Trinidad was over­see­ing BG's North Sea op­er­a­tions in Ab­erdeen. While he was work­ing at BG here, the pre­vi­ous At­lantic chief ex­ec­u­tive, Os­car Pri­eto, re­signed and the post be­came va­cant. He ap­plied, was in­ter­viewed and hired and start­ed his new job in De­cem­ber.