As con­cerns over po­lit­i­cal un­rest in Venezuela con­tin­ue, and the un­cer­tain­ty of who will be the next Unit­ed States pres­i­dent, Na­tion­al Gas Com­pa­ny (NGC) chair­man Dr Joseph Ish­mael Khan is cau­tious­ly op­ti­mistic that the nat­ur­al gas will flow, fol­low­ing the 30-year ex­plo­ration and pro­duc­tion li­cence for the Drag­on Gas deal.

Dr Khan was re­spond­ing to a ques­tion from the au­di­ence at the TT Man­u­fac­tur­ers’ As­so­ci­a­tion (TTMA)’s an­nu­al post-bud­get dis­cus­sion at the Hy­att Re­gency in Port of Spain, on Tues­day. The ques­tion­er point­ed out the risk be­ing tak­en by the whol­ly state-owned T&T en­er­gy com­pa­ny amidst the po­lit­i­cal un­rest.

In re­sponse, Khan said NGC has agree­ments in place, pre-en­gi­neer­ing work has start­ed and sig­nif­i­cant ac­tiv­i­ties are hap­pen­ing be­hind the scenes.

Fur­ther ques­tioned by a mem­ber of the au­di­ence, as to whether NGC has any fears that the agree­ment will be in­ter­rupt­ed by the un­rest, Khan said the com­pa­ny is not fear­ful.  

Fi­nance Min­is­ter Colm Im­bert in­ter­ject­ed and said “This coun­try has a ca­pac­i­ty that we can uli­tilise 4.2 bil­lion cu­bic feet of gas per day. That is what our petro­chem­i­cal in­dus­try needs, that is what At­lantic LNG needs. We are gen­er­at­ing 2.7 bil­lion cu­bic feet of gas per day. We are short of 1.5 bil­lion cu­bic feet of gas. Our in­dus­tries are run­ning at 70 per cent and 60 per cent. So, the gas is avail­able in Venezuela, and we agree to get it.”

The au­di­ence mem­ber fur­ther probed about the gas risk be­ing tak­en by the cur­rent Venezue­lan Gov­ern­ment.

Im­bert quick­ly stat­ed that suc­cess­ful con­glom­er­ates take risks.

“You can­not grow your busi­ness un­less you take a risk. If you are risk averse, you will just shrink and die. The way we look at it is that the gas is avail­able in Venezuela. We be­lieve we have suf­fi­cient pro­tec­tion in place. We be­lieve the gas will come and that is the so­lu­tion for the pros­per­i­ty for T&T,” the min­is­ter de­tailed.

Last De­cem­ber, the Drag­on Gas agree­ment was signed by Min­is­ter of En­er­gy Stu­art Young.

The gas li­cence grant­ed by the Venezue­lan gov­ern­ment and signed last De­cem­ber, will have a du­ra­tion of 30 years and will have the pos­si­bil­i­ty of be­ing ex­tend­ed for a pe­ri­od agreed by the par­ties.

Some 70 per cent of the gas pro­duced will be ex­port­ed to T&T for liq­ue­fac­tion at the At­lantic fa­cil­i­ty in Point Fortin, and the re­main­ing 30 per cent will be des­tined for the petro­chem­i­cal sec­tor, ac­cord­ing to the terms of the li­cense.

Ac­cord­ing to Ar­ti­cle 62 of the agree­ment, the li­cencees will em­ploy and re­quire their con­trac­tors to em­ploy Venezue­lans to the great­est ex­tent pos­si­ble.

Ar­ti­cle 71 states that the li­cencees may re­nounce their ex­plo­ration and ex­ploita­tion rights, as long as they have com­plied with all their oblig­a­tions and must no­ti­fy the Venezue­lan Min­istry of Pe­tro­le­um 365 days in ad­vance.

Ar­ti­cle 74 states that in the event of pro­mul­ga­tion of new laws or up­dates of ex­ist­ing laws with­in Venezuela, the Min­istry of Pe­tro­le­um, at the re­quest of the li­cencees, will take mea­sures to up­date the plan for whose pur­pos­es it has been ap­proved, thus con­tribut­ing to the macro­eco­nom­ic sta­bil­i­sa­tion of the project.