To date the discussion has focussed on whether after a drop in foreign exchange earnings it is more efficient and effective to stabilise a small open economy via a devaluation or, instead, fiscal...
You are here
Energy Minister: Gas supply to improve slightly in 2015
A slight improvement in gas production in T&T is expected in 2015, Energy and Energy Affairs Minister Kevin Ramnarine forecast at a Petroleum Economist hydrocarbon strategy forum at the Hyatt Regency in Port of Spain.
“Last year we did say that there were going to be (fewer) shutdowns this year (2014) and we had quite a bit of shutdowns this year, but 2015 should have a slight improvement because, as you know, Starfish is coming on this weekend and that will bring on an additional 220 million standard cubic feet of gas per day (mmscf/d) and it’s the first new gas field to come online in T&T in a while,” he said.
Asked about natural gas curtailments Ramnarine said: “You can’t expect natural gas to simply run infinitely. We’re not producing corn flakes and orange juice out there. We’re producing natural gas.”
Speaking to reporters after the opening ceremony, Ramnarine said the Petroleum Economist forum discussed many of the same issues the national natural gas master plan will seek to address. This included the role of the National Gas Company of T&T (NGC) in the future of the country; how to optimise distribution of gas between Point Fortin and Point Lisas; the impact of what is happening in the US on local gas; and what is the future of development for cross-border reserves between T&T and Venezuela.
Ramnarine said he was aware of statements made by Central Bank Governor Jwala Rambarran that the energy sector performance was “dismal” and contracted 1.5 per cent in the first 11 months of 2014. He admitted that there had been “a lot of supply disruptions throughout the year” mainly at BP, BG Group and BHP Billiton “because companies have to do maintenance.” He said, by way of example, that when BP’s Savonette platform, the country’s largest gas well, which produces 800 mmscf/d, was impaired for 10 days, it impacted the gas supply in the country.
Asked about prices the T&T gas is selling for, Ramnarine said: “We had some pretty good prices for natural gas in the markets to where the gas is being diverted to. In Asia, we get a price of around US$14 per million British thermal units (mmbtu); in South America we get not far from that but not US$14; and in Europe you always get double-digit figures.”
At a post-Cabinet news conference on November 20, Minister of Finance and the Economy Larry Howai had said T&T’s gas prices are averaging 22 per cent more than the budgeted US$2.75 per mmbtu price, which equates to US$3.36 per mmbtu.
Ramnarine said: “Now, those prices will be under pressure, naturally, as oil begins to fall because in those markets natural gas prices are indexed to oil, so that as oil prices fall, what you have taking place is substitution.
You have power companies in Japan, in South America, in Europe and so on, beginning to switch from natural gas to oil, reducing the demand for natural gas and putting downward pressure on natural gas prices, so that too is something we have to keep an eye on, but there is a lag between when the oil prices fall and when you see the impact on the gas prices.”
Asked for prices of local crudes—Galeota Mix produced by BP and Repsol and Calyspo crude, produced by BHP Billiton—Ramnarine said BP, Repsol and BHP Billiton get a higher price than West Texas Intermediate (WTI) for the “high quality,” light, sweet crude they produce off the east coast of Trinidad, without giving a specific figure. He said Petrotrin crudes are medium to heavy, and fetch a lower price than WTI, “so when you average out everything it comes out to about 2 per cent less than WTI.”
He said he expects the energy sector to continue to supply the country with revenue. Ramnarine also said state-owned National Energy Corporation (NEC) is going to compete in the business of transport, to move workers to and from rigs and platforms, via Port Galeota with a recently purchsed vessel.