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Tuesday, January 10, 2017

Kevin Ramnarine

​By the time this column is published we may or may not have a strike at Petrotrin. Unfortunately, the angst and the anxiety generated around the potential strike have drummed out another major event in the energy sector.

Most would not have known that last Wednesday history was created in T&T when the completed BP Juniper Topside (the topside is that part of the platform above the waterline) was loaded onto a barge at La Brea. The second part of the platform, the jacket (the jacket is the part of platform below the water line) was fabricated in Texas after a decision was taken in mid-2015 to relocated it there from La Brea. This was due to a slippage in the schedule of the project due to a delay in the arrival of steel and protest by workers.

Why is that a big deal? At 5,670 metric tonnes and 180 feet tall (12 stories), the Juniper Topside is the largest offshore structure ever fabricated in T&T. It represents a great achievement by this country. The loading onto the barge signalled the handover of the Topside from TOFCO to BPTT. It’s a project on which the fortunes of the national economy in 2017/2018 will balance.

I was happy to be there to witness it. It allowed me the opportunity to start my new year at the fabrication yard at La Brea with productive people. This included the team at TOFCO, representatives of BPTT and the many local contractors who worked on the project. In the moment, it dawned on me that while some were starting 2017 building the country’s energy sector others were working feverishly to tear it down.

I have a personal connection to the Juniper project. The investment by BP came about because of strategic interventions made by me and former Finance Minister Larry Howai in 2013. These changes to the fiscal regime landed that investment and others. Back then we knew we had to take action to make the country’s upstream more competitive and to start attracting investment again. The incentives worked and that is why when drilling activity was collapsing all over the world, in T&T it held firm.

I was asked by someone at the fabrication yard, “What does Juniper mean?” I said to him, “You all have made history.” Juniper represents our local oil and gas sector on the grandest scale. It’s a US$2.1 billion investment which makes it the most expensive upstream development in our country’s history. To give you an idea of the scope of this project, firstly it took the largest air plane in the world (Russian Antonov 225) to deliver the five sub sea trees to T&T. Secondly, the crane that will lift the Topside is the largest crane vessel in the world, the Heerema Thialf.

By the fourth quarter of this year the platform will begin producing 590 million standard cubic feet per day of much-needed natural gas. That is a huge amount of gas by any standard. From approval by BP in July 2014 to start of gas production in October 2017, Juniper took over three years. It will guarantee economic growth in T&T in the fourth quarter of 2017 and for most of 2018. There are also three other projects that will add to natural gas supply in 2017.

The loading of the topside onto the barge was however a bittersweet moment. While there was a huge sense of satisfaction and achievement around the yard that morning, there was a sense of “what’s next?” What is the next platform to be fabricated by TOFCO at Labidco? Is the yard going into dormancy again?

I had written a few months aback that Juniper may well be the last platform built at La Brea. I sincerely hope that this never happens. My earlier column captioned “the last platform” was meant to serve as a wakeup call. The truth is T&T is rapidly losing competitiveness in its energy sector especially as it relates to project execution. If we don’t shape up, one day we will wake up and realise Mexicans and Texans have eaten our lunch.

The next project on the drawing board for BP should be Angelin. Much to my dismay, it has not yet been approved by BP. We should not be surprised since there has been is a lot of pussyfooting by the current Government with the energy sector and the Angelin project is a victim of this. Angelin will take two years from approval by BP to start of production. The country needs BP to approve this project this month. The keep back has been the finalisation of a new BP/NGC domestic contract for the period January 2019 and beyond. Why has that not been finalised?

If things went to plan, as the Juniper Topside was loaded onto that barge, work would have started on the next platform (Angelin). The fact that this did not happen speaks volumes about the slow-motion pace of decision making in 2016.

Are there too many cooks spoiling the energy broth? Let’s hope for all our sakes that BP approves Angelin soon and let’s hope that the Angelin platform is fabricated at La Brea.

• Kevin Ramnarine is the former Minister of Energy of Trinidad and Tobago


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