For the first quarter of 2020 Trinidad and Tobago NGL Limited (TTNGL) recorded an after tax profit of $6.9 million. This represents an 85 per cent slide from the comparative period in 2019 of $45.8 million.
In the report of the company’s financials, Chairman Conrad Enill said: “These results were driven by a sharp decline in performance at PPGPL with the recognition of a lower share of profit from the Company’s investment in the joint venture.”
Enill expressed that COVID-19 has created a temporary demand collapse in energy prices across all markets, where the decline is coupled with the aftermath of a price war that has brought a massive crude oil supply inventory glut as producers struggle to find markets for their products and has sent some prices to unprecedented lows.
He said that Natural Gas Liquid (NGL) prices which correlate strongly with crude oil and refined product prices, predictably, were negatively impacted during the quarter.
For the three months to 31 March 2020, Enill said, “the turbulence in the energy commodity markets that closed off 2019 continued into 2020 and was exacerbated by the impact of the Coronavirus (COVID-19) pandemic.”
Additionally, Enill noted that the sharp decline in Mont Belvieu product prices significantly impacted the performance of the company’s underlying asset Phoenix Park Gas Processors Limited (PPGPL).
According to the Chairman recorded prices were 32 per cent lower than the corresponding period in 2019.
He said that the effects of the pandemic has also disrupted the planned performance and markets of the petrochemical producers at Point Lisas and the disruption has translated into lower natural gas demand and lower gas volumes through the PPGPL facility for processing.
Enill said that PPGPL continued to be impacted by lower NGL content in the gas stream and NGL production for the quarter was 10 per cent lower than in 2019.
However, on a positive note he said PPGPL continued to maintain high operating availability and has sustained its focus on prudent cost and cash management.
In order to aggressively grow its business both locally and internationally, in February 2020, PPGPL through its wholly owned US subsidiary, Phoenix Park Energy Marketing LLC, acquired the NGL liquids marketing assets of Twin Eagle Liquids Marketing LLC.
Twin Eagles Marketing LLC is a Company based in Houston Texas, USA which is engaged in the business of marketing, trading and transportation of natural gas liquids.
Enill said that earnings from this acquisition is expected to positively impact Company results in the future.