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Range, Touchstone and Lease Operators get onshore blocks
Range Resources Limited, Lease Operators Limited and Touchstone Exploration Inc have been awarded blocks for oil and gas exploration and production from last year’s onshore bid round. Energy and Energy Affairs Minister Kevin Ramnarine announced the bid results yesterday during the T&T Energy Conference which is taking place at the Hyatt Regency in Port-of-Spain. The St Mary's (Moruga) block was awarded to London-listed Range Resources, while the Rio Claro block went to Lease Operators and the Ortoire block to Toronto-listed Touchstone Exploration Inc. In T&T's 2013 onshore bid round, six energy companies competed for the rights to explore and produce oil and gas in three parts of Trinidad. The bid round opened on May 16 and closed on October 31. AV Oil and Gas Limited bid on Rio Claro and Ortoire. Glint Energy LLC and Lease Operators bid on all three. Touchstone Exploration Inc bid on Ortoire. Range Resources Limited and Trinity Exploration and Production plc bid on St Mary’s. Ramnarine said energy will be a major topic when Prime Minister Kamla Persad-Bissessar visits Chinese President Xi Jinping in Beijing later this month. He also said T&T’[s liquified natural gas (LNG) market will change after the Panama Canal is expanded. Though the exact ranking varies from month to month on production numbers, T&T is one of the largest LNG producers in the world, frequently figuring among the top ten.
Asked how the Panama Canal widening will affect the T&T LNG business, the minister explained: “It means that it will be easier to get LNG cargoes from here into Japan (and) Korea, but it also means the Australian cargoes will come, so it will be a double-edged sword.” Hovering around and above US$15 per million British thermal units (mmbtu), LNG prices in Asia are often the highest in the world. The lowest prices are usually found on the New York Mercantile Exchange (Nymex) at around US$5 per mmbtu. From Point Fortin-based Atlantic LNG, T&T now exports most of its spot cargoes to Argentina and Brazil. The minister said this dynamic could change. Also addressing the conference was Trinity Exploration and Production plc executive chairman and founder Bruce Dingwall who recommended that T&T follow the Ecopetrol model. Ecopetrol is the Colombian state-owned oil company, which, though newer, has been more successful than T&T's Petrotrin. Dingwall said since the playing field was leveled in Colombia, Ecopetrol has had to compete for blocks like any other oil company and that country's production has grown exponentially.
Energy Chamber president Roger Packer said he is sometimes asked if the conferenceis just a talk shop or actually changes how the industry operates. He said he could say “without hesitation that the energy conference does indeed lead to change in the industry”. The past few years have seen “very high levels of upstream activity in T&T,” he said. “Drilling activity in particular, has shown a very marked increase over the past two years, and we expect that high level of drilling activity to continue through 2014. “The increase in drilling that we have seen has come about because of policy measures introduced by the government and specifically the series of fiscal reform measures introduced in successive national budgets between 2010 and 2013.” Packer added: “Discussions at the energy conference directly feed into those policy reforms. In other words, talk here in this room led to new drilling and therefore new production, new reserves, new investments, jobs and government revenue.” Making a plug for lower taxes for the oil and gas industry, Packer said while T&T has “seen some excellent progress on fiscal reform, over the past few years, there are still many issues that need to be addressed to ensure that we have a vibrant and competitive energy sector to attract continued investment.”