Nadaleen Singh

Gov­ern­ment is mov­ing to re­struc­ture the fis­cal regime for oil and gas pro­duc­tion, tak­ing in­to con­sid­er­a­tion a re­view by the In­ter­na­tion­al Mon­e­tary Fund (IMF), act­ing En­er­gy Min­is­ter Colm Im­bert said yes­ter­day.

Im­bert, who filled in for the ail­ing Franklin Khan at the T&T En­er­gy Con­fer­ence and Trade Show, which opened at the Hy­att Re­gency in Port-of-Spain, said it was nec­es­sary to pro­duce a win-win sit­u­a­tion for all to mo­ti­vate en­er­gy com­pa­nies to ex­plore and in­crease pro­duc­tion so that Gov­ern­ment could op­ti­mise its rev­enue from the sec­tor.

"As part of the over­all strat­e­gy to in­crease hy­dro­car­bon pro­duc­tion, the min­istry in 2017 will make avail­able for ex­plo­ration, acreage on land, and in ma­rine ar­eas, in­clud­ing our deep-wa­ter province. Such ar­eas may in­clude acreage that has been re­lin­quished or that has re­vert­ed to the State by virtue of the ex­pi­ra­tion of con­trac­tu­al dead­lines.

"The min­istry is cur­rent­ly as­sess­ing prospects and in short or­der will be re­quest­ing nom­i­na­tions from up­stream com­pa­nies as part of the process in the se­lec­tion of blocks for the bid round.

"The ini­tia­tives to stim­u­late the do­mes­tic en­er­gy sec­tor will al­so in­clude the re­view of the fis­cal regime for hy­dro­car­bon pro­duc­tion tak­ing in­to con­sid­er­a­tion the re­view un­der­tak­en by the In­ter­na­tion­al Mon­e­tary Fund and stake­hold­er feed­back," he said.

Im­bert said the coun­try suf­fered a 90 per cent de­cline in rev­enue from pe­tro­le­um, from $19 bil­lion in 2014 to less than $2 bil­lion last year, be­cause of the drop in oil prices. He iden­ti­fied re­form of the Sup­ple­men­tary Pe­tro­le­um Tax, eq­ui­table use and dis­tri­b­u­tion of nat­ur­al gas among down­stream com­pa­nies and agree­ment with the up­stream pro­duc­ers on new long term gas sup­ply con­tracts as is­sues that must be con­front­ed.

"There is sig­nif­i­cant dis­par­i­ty in val­ue ac­cru­ing to Gov­ern­ment as com­pared to that re­ceived by en­er­gy com­pa­nies and their as­so­ciates from the mon­e­ti­za­tion of this coun­try's hy­dro­car­bon re­sources. It is there­fore nec­es­sary to re­align the in­ter­ests of the com­pa­nies and the Gov­ern­ment to en­sure eq­ui­table out­comes for all par­ties and ul­ti­mate­ly the peo­ple of Trinidad and To­ba­go," he said.

Im­bert said state-owned Petrotrin, which ac­counts for al­most 50 per cent of the coun­try's to­tal oil pro­duc­tion, is "the key to im­proved oil pro­duc­tion in T&T for the short term and long term."

He added: "It is our best chance to re­verse the cur­rent de­cline and the Gov­ern­ment will there­fore be ex­am­in­ing and im­ple­ment­ing a wide range of strate­gies in 2017, in­clud­ing joint ven­tures, to boost and en­hance Petrotrin's oil pro­duc­tion, both on land and in the ma­rine area, as out­lined by the Prime Min­is­ter in his ad­dress to the na­tion."

In the up­stream sec­tor, the num­ber of wells pro­ject­ed for 2017 has dropped from 69 last year, to 56 de­vel­op­ment wells in 2017.

The min­is­ter said: "We need to re­verse this trend since in re­spect of crude oil and con­den­sate, pro­duc­tion is ex­pect­ed to im­prove on­ly mar­gin­al­ly from the cur­rent pro­duc­tion of ap­prox­i­mate­ly 71,000 bar­rels of oil per day."

He said the Gas Mas­ter Plan re­port will be sub­mit­ted to Par­lia­ment's En­er­gy Af­fairs Com­mit­tee af­ter it is re­viewed by the En­er­gy sub-com­mit­tee of Cab­i­net. The En­er­gy Task Force, head­ed by for­mer fi­nance min­is­ter Wen­dell Mot­t­ley, has been meet­ing with stake­hold­ers in the sec­tor about the plan, Im­bert said.

"In the com­ing weeks, these con­sul­ta­tions will in­ten­si­fy and we are op­ti­mistic that the par­ties will ar­rive at an ac­com­mo­da­tion on gas sup­ply and pric­ing arrange­ments for the medi­um term."

Im­bert said gas pro­duc­tion is ex­pect­ed to in­crease this year when the Trinidad Re­gion­al On­shore Com­pres­sion Project (TROC) and Ju­niper come on stream. Be­yond 2018,the projects to come on stream–An­gelin, Sa­van­nah, South East Queen Beach and Off­shore Com­pres­sion–are ex­pect­ed to pro­vide sta­bil­i­ty to do­mes­tic gas pro­duc­tion, sup­ple­ment­ed by gas from Venezue­lan by 2019.

In oth­er in­dus­try de­vel­op­ments, Im­bert said sev­en ex­plo­ration wells will be drilled this year, in­clud­ing in bpTT's Colum­bus Basin acreage, while BHP Bil­li­ton will con­tin­ue its deep wa­ter ex­plo­ration pro­gramme with two more wells sched­uled for the third and fourth quar­ters of 2017.

In ad­di­tion, T&T will con­tin­ue to deep­en its glob­al foot­print, he said,

"Through NGC we are par­tic­i­pat­ing in the in­fra­struc­tur­al de­vel­op­ment, pro­cess­ing and mar­ket­ing of sig­nif­i­cant proven nat­ur­al gas provinces, which are lo­cat­ed out­side the ju­ris­dic­tion of T&T. The ma­jor across the bor­der prospect is the Drag­on Field," he said.