Aleem Khan

T&T has put up nine blocks for bids from oil and gas com­pa­nies seek­ing li­cens­es for ex­plo­ration and pro­duc­tion (E&P) on­shore and off­shore Trinidad, ac­cord­ing to the Web site of the Min­istry of En­er­gy.The min­istry had an­nounced the two com­pet­i­tive bid rounds would take place this year, when the suc­cess­ful bid­der from the 2012 deep­wa­ter bid round was an­nounced on De­cem­ber 7, 2012.On May 9, the min­istry's Web site was up­dat­ed to say that the on­shore com­pet­i­tive bid round 2013 opened in April and will close in Au­gust. The off­shore com­pet­i­tive bid round 2013, a deep­wa­ter bid round, al­so opened in April, but will close in Oc­to­ber. In the deep­wa­ter bid round, "six blocks off Trinidad's east coast are avail­able for bid­ding," the min­istry said.

On­shore, ap­prox­i­mate­ly "64,000 hectares in Trinidad's south­ern basin are open for bid­ding," the min­istry said. They are the Rio Claro Block which is around 74,954 acres (30,333 hectares), the Or­toire Block, which is around 44,731 acres (18,102 hectares), and the St Mary's Block, which is around 37,760 acres (15,280 hectares).The tech­ni­cal pre­sen­ta­tion for the on­shore blocks, pre­pared by the En­er­gy Min­istry, and state-owned oil com­pa­ny, Petrotrin, said the "area of in­ter­est (is) sur­round­ed by pro­duc­ing oil fields with field pro­duc­tion rang­ing from sev­en to 150 mil­lion bar­rels of oil."Over the last 100 years of com­mer­cial oil pro­duc­tion, T&T has pro­duced more than four bil­lion bar­rels of oil (BBO), the pre­sen­ta­tion said, adding that there is good ex­ist­ing in­fra­struc­ture in T&T, as well as a good da­ta set for well and seis­mic da­ta.

The St Mary's block strad­dles Siparia and Moru­ga. It is a "south­west­er­ly block ly­ing south of Petrotrin's Bar­rack­pore Field and ad­ja­cent to the Rock Dome/Cat­shill In­niss Field," the pre­sen­ta­tion said.The Or­toire block strad­dles Or­toire and Guayagua­yare. It is a "south­east­er­ly block ly­ing east and on trend with the Rock Dome/Cat­shill In­niss Field," the pre­sen­ta­tion said.The Rio Claro block strad­dles Rio Claro, Charu­ma and Nar­i­va. The Rio Claro Block is east of Petrotrin's Bar­rack­pore Field and south of the Cen­tral Range Block which is un­der ex­plo­ration via E&P li­cence, the pre­sen­ta­tion said.

Deep­wa­ter bid round

"An ex­plo­ration and pro­duc­tion li­cence will be is­sued to win­ning bid­der(s) for each block," the min­istry and Petrotrin said in an­oth­er pre­sen­ta­tion dat­ed April 2013. The pre­sen­ta­tion said the "li­censee un­der­takes ex­plo­ration, drilling and de­vel­op­ment at its sole risk and cost" and "rev­enue to the host gov­ern­ment is paid via rentals, tax­es and roy­al­ties."Bid­ders must pay a bid par­tic­i­pa­tion fee of US$40,000, which en­ti­tles the bid­der to ac­cess a da­ta pack­age for all the blocks in the bid round. As for the deep­wa­ter blocks, re­quests for nom­i­na­tions have been made, but the min­istry's Web site has not yet been up­dat­ed to show which blocks were nom­i­nat­ed and are now avail­able for bid­ding.Car­ol Tele­maque, Petrotrin's se­nior man­ag­er for ex­plo­ration and de­vel­op­ment, had said dur­ing the of­fi­cial launch of the on­shore bid round dur­ing the T&T en­er­gy con­fer­ence in Jan­u­ary this year: "Our ex­pec­ta­tion is that the award will be done on Sep­tem­ber 6."

A date has not yet been an­nounced for the award of the deep­wa­ter bid round which clos­es in Oc­to­ber. Deep­wa­ter bid rounds have in the past been ex­tend­ed.Last year's deep­wa­ter bid round, out of which Aus­tralia's BHP Bil­li­ton emerged the sole win­ner, was hailed by the min­istry as "the most suc­cess­ful bid round in 14 years" in a state­ment.Bids were re­ceived on five out of the six deep­wa­ter blocks of­fered, and in to­tal 12 bids were re­ceived. BHP Bil­li­ton was award­ed four of the six blocks, and the fifth block was not award­ed for want of "suit­able bids" meet­ing the se­lec­tion com­mit­tee's work pro­gramme re­quire­ments.Min­is­ter Ram­nar­ine had said the BHP Bil­li­ton award would mean an in­vest­ment of at least US$565 mil­lion and at most US$1.023 bil­lion.

New BHP Bil­li­ton CEO

On May 14, while giv­ing an overview of the com­pa­ny's projects in pe­tro­le­um, among oth­er nat­ur­al re­sources, new BHP Bil­li­ton chief ex­ec­u­tive of­fi­cer An­drew Macken­zie made no men­tion of any projects planned in T&T.Speak­ing at the Bank of Amer­i­ca Mer­rill Lynch 2013 Glob­al Met­als, Min­ing and Steel Con­fer­ence in Barcelona, Macken­zie said BHP Bil­li­ton's "projects re­main on sched­ule and bud­get."Though the con­fer­ence was on met­als and min­ing, Macken­zie briefed the au­di­ence on the com­pa­ny's plans in pe­tro­le­um and potash, iron ore, cop­per, coal, alu­mini­um, man­ganese and nick­el. His pre­sen­ta­tion cov­ered plans from 2013 through 2016 for less than or equal to US$500 mil­lion, as well as greater than US$500 mil­lion.Macken­zie's pre­sen­ta­tion al­so said BHP Bil­li­ton's cap­i­tal ex­pen­di­ture will peak in 2013 and de­cline there­after.

He said: "You will recog­nise my pas­sion for our pro­duc­tiv­i­ty agen­da and this ex­tends to our de­vel­op­ment projects. We must chal­lenge our­selves to in­crease re­turns from new in­vest­ment, in the same way that we need to squeeze re­turns from our in­stalled in­fra­struc­ture.In this re­gard, cap­i­tal and ex­plo­ration ex­pen­di­ture for the 2014 fi­nan­cial year will de­cline sig­nif­i­cant­ly, to ap­prox­i­mate­ly US$18 bil­lion, and the rate of spend is ex­pect­ed to de­cline sub­stan­tial­ly there­after."By re­duc­ing our an­nu­al spend and in­creas­ing in­ter­nal com­pe­ti­tion for cap­i­tal, we ex­pect to max­imise re­turns from in­cre­men­tal in­vest­ment, while de­liv­er­ing a sub­stan­tial in­crease in the group's free cash flow."