It’s not every day that I wake up cursing.
The crude oil industry saw growth during the second half of 2013 despite major maintenance activity which affected condensate production, the Central Bank of T&T has reported.
In its January 2014 Economic Bulletin released March 6, the Central Bank said: “The progressive decline in the crude oil industry has seemingly been arrested in 2013 and, aided by a more favourable tax regime, began showing signs of a modest recovery. Crude oil output witnessed year-on-year growth of 1.3 per cent. However, exploration activity was slightly down as drilling declined 13.8 per cent, year on year, while rig days, another indicator of exploration activity, were down 13.0 per cent.”
Activity at the Petrotrin refinery witnessed modest growth during the latter half of 2013, the bank said. Year-on-year growth of 45.1 per cent during this period came about as operations at the refinery recovered from both industrial action and major maintenance activity which hampered production in 2012. Refinery throughput recovered to 136,035 barrels per day during the period, up from 91,358 barrels per day recorded in the corresponding period a year earlier. The international trade in crude also saw favourable growth.
Domestic crude oil producers sold 34.3 per cent more crude oil on the international market during the second half of 2013 compared to 2012, while Petrotrin imported 94.0 per cent more crude oil over the same period. This followed a sharp fall-off in imports the year before when the refinery curtailed its operations for maintenance activity.
International crude oil prices have also remained relatively strong during the latter half of 2013 compared to the corresponding period a year earlier, the bulletin said. This was associated with geo-political events in Egypt and Syria. Brent crude oil prices (UK) averaged US$110 per barrel during the period, unchanged from a year ago. West Texas Intermediate (WTI) prices increased markedly however, averaging US$101.62 per barrel during the second half of 2013 compared to US$90.15 per barrel for the same period in 2012.
The bulletin also covered liquefied natural gas (LNG) and natural gas liquids (NGLs) production. “Atlantic’s Train 3 was shut down as part of the co-ordinated maintenance in September 2013, while NGL production increased slightly from a year ago. Major maintenance at Train 3 saw Atlantic operating at just about 70 per cent of capacity during September 2013.
“As a consequence, LNG production declined by 3.5 per cent during the second half of 2013. Meanwhile, provisional data shows that production of NGLs increased by 0.4 per cent to 6.2 million barrels during the second half of 2013 compared with the corresponding period of 2012,” the bulletin said.
Given lower natural gas production, this marginal increase in production of natural gas liquids indicates that the natural gas produced during the latter half of 2013 contained more liquids than before, reversing the pattern over the last 18 to 24 months.
Turning to petrochemicals, the Central Bank said: “The downward trend in the fertiliser production which has been seen throughout the first half of 2013 has eased in the second half of the year. Though significant maintenance activity during September 2013 led to outages at the Tringen II plant as well as at the PCS Nitrogen ammonia plants, maintenance activity in the industry in 2012 also limited activity in that period.
“As a result, a year-on-year comparison shows minimal change in output levels. Meanwhile, weak demand has put international fertiliser prices under significant downward pressure during the second half of 2013. Ammonia prices fell 33.7 per cent to an average of US$436.13 per tonne during the second half of 2013 while urea prices fell 27.3 per cent to an average of US$315.42 per tonne over the same period.”
Though gas curtailments adversely affected methanol production during July to December 2013, production was up 5.8 per cent year-on-year. Several methanol plants, including the M5000 and Titan plants, opted to carry out plant maintenance in September 2013 given upstream natural gas curtailments. These plants returned to normal production by October 2013.
On the other hand, the maintenance activity in 2012 saw significant downtime at methanol plants during September and October of that year, significantly reducing the level of output. Co-ordination between the Ministry of Energy and Energy Affairs and several upstream and downstream entities resulted in the shortened period of maintenance in 2013.
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