Senior Reporter
geisha.kowlessar@guardian.co.tt
T&T’s energy sector is facing mounting financial pressure, as declining gas supplies, expiring contracts and a string of petrochemical plant shutdowns converge to erode foreign exchange earnings and government revenue—raising urgent questions not only about the scale of the economic fallout, but also about the policy direction needed to stabilise and sustain the industry.
Energy experts, business leaders and the Opposition warn that with hundreds of millions of US dollars in annual earnings already lost, the country must now confront difficult decisions on gas allocation, investment strategy and the long-term future of its energy model.
At the centre of that concern is the mounting economic impact as energy analyst Gregory McGuire estimated the combined loss of production from petrochemical shutdowns—including Methanex’s Atlas plant, that company’s Titan facility and Nutrien’s five-plant nitrogen complex—could remove between US$500 million and US$700 million in annual foreign exchange earnings that have gone offline in less than 12 months.
“This is equivalent to about two to three per cent of GDP, or close to a tenth of total exports. Individually, each shutdown looks revivable, together they represent a real and growing hole in the current account and in Government revenue at exactly the moment energy revenues are already under pressure from weaker prices.
“Beyond the forex hit, Trinidad also loses a stream of corporate tax, Green Fund Levy (and possibly business levy) receipts tied to Titan’s output,” he explained.
While the direct job impact is limited, because of the capital intensive nature of the industry, the secondary impact across service subcontractors, providing maintenance, security, IT and labour contracts could also be significant with McGuire estimating this could be upwards of 2,000 people.
Further he warned there is likely to be a major policy challenges with respect to new gas supplies (Cypre, Mento, Manatee) as this would need to be allocated between LNG exports and petrochemicals.
“Government/NGC will have to declare a clear policy on allocation to retain the petrochemical business. It is apparent that the current policy gives preference to LNG,” he advised.
Against that backdrop, the idling of Methanex’s Titan methanol plant in October, when its current gas supply contract ends, has become a focal point for wider concerns about the direction of the energy sector.
Energy expert Carolyn Seepersad-Bachan described the development as part of a deeper structural issue—one rooted in a growing energy security deficit.
“This is not a crisis that emerged overnight, nor is it the result of a single policy decision. It is the cumulative consequence of declining domestic gas reserves, inadequate reserve replacement, delays in bringing new discoveries into production and an insufficient pace of upstream exploration over more than a decade. Simply put, we have consumed our natural gas resources faster than we have replaced them,” she explained.
That diagnosis is reinforced by McGuire, who emphasised the Titan shutdown cannot be viewed in isolation.
“Titan’s idling is the latest in a sequence (Atlas, Nutrien) reflecting a structural decline in upstream gas production, not a single commercial dispute. Plants are increasingly competing for a shrinking pool of feedstock gas, on shorter contracts (reportedly six months) at higher prices.
“Consolidation pressure, further capacity reduction in methanol and ammonia/urea, T&T’s flagship downstream exports, means that the country is losing its status as a major petrochemical exporter,” McGuire said.
For Seepersad-Bachan, the consequences are far-reaching as she noted the methanol industry has historically been a major contributor to the economy, accounting for close to eight per cent of gross domestic product at its peak and generating significant foreign exchange earnings.
Each plant, she explained, supports a wide network of economic activity, including engineering services, fabrication, transport, marine operations, maintenance contractors and financial services. As a result, the impact of a shutdown extends well beyond the facility itself.
“When a plant closes, the effect is felt across the entire value chain,” she said, pointing to losses in exports, government revenue and employment.
From a private sector perspective, Amcham T&T CEO Nirad Tewarie highlighted the complexity of the current moment, describing it as a delicate balancing act.
He noted T&T is dealing with lower gas volumes than required to sustain the entire industry, while policymakers must also manage fiscal pressures and maintain investor confidence.
“We are dealing with lower gas volumes than we need for the entire industry to be whole,” Tewarie said, underscoring the challenge of allocating limited supply.
At the same time, he pointed to cautious optimism, noting expectations that additional gas could come onstream in the near term.
However, he stressed this transition period must be managed carefully to preserve competitiveness across all segments of the energy value chain.
“We have to manage this period very carefully… so that when we do achieve more gas, we have a market to sell into,” he adds, emphasising that global companies are constantly evaluating where to invest.
Tewarie also underscored the importance of maintaining diversification within the sector stating that T&T has historically benefited from producing a mix of LNG, methanol and ammonia, which helps cushion the economy against volatility in global commodity prices.
The erosion of petrochemical capacity, he warned, threatens that balance.
Seepersad-Bachan echoed this concern, cautioning against an over-reliance on exporting raw gas rather than creating value through downstream industries.
Preserving the petrochemical sector, she argued, is essential to maximising long-term economic returns and supporting employment.
She also raised concerns about investor confidence.
Methanex, she noted, has been a long-standing investor in T&T, and its decision to idle the Titan plant due to gas constraints sends a signal to the international market about supply reliability.
While opportunities such as accessing regional gas supplies exist, Seepersad-Bachan maintains that these cannot substitute for a strong domestic resource base, given the geopolitical and regulatory uncertainties involved.
“The long-term solution lies at home,” she argued, calling for renewed focus on upstream exploration, faster development of discovered reserves, competitive bid rounds and a sustained national effort to rebuild gas supply.
On the political front, Opposition member Stuart Young has also raised concerns, stating that the Titan shutdown “does not augur well” and should be viewed alongside other recent developments, including the closure of Nutrien and the short-term nature of existing gas contracts.
“Add this disaster to the shutdown of Nutrien… and unfortunately our energy sector is in shambles,” Young said, pointing to uncertainty facing producers beyond 2026.
