An­drea Perez-Sobers

Se­nior Re­porter

an­drea.perez-sobers@guardian.co.tt

En­er­gy com­pa­nies gen­er­at­ed an es­ti­mat­ed US$17.3 bil­lion in for­eign ex­change be­tween 2011 and 2024, un­der­scor­ing the sec­tor’s con­tin­ued cen­tral­i­ty to T&T’s eco­nom­ic sta­bil­i­ty de­spite grow­ing volatil­i­ty, ac­cord­ing to da­ta pre­sent­ed by the Trinidad and To­ba­go Ex­trac­tive In­dus­tries Trans­paren­cy Ini­tia­tive (TTEITI).

Head of the sec­re­tari­at at the TTEITI, Sher­win Long, said the en­er­gy sec­tor re­mains the coun­try’s sin­gle largest source of for­eign ex­change, with BP and the Na­tion­al Gas Com­pa­ny (NGC) alone con­tribut­ing a com­bined US$14.8 bil­lion over the pe­ri­od. The fig­ures are based on re­port­ing from the five largest con­trib­u­tors, BP, Shell, EOG, Wood­side and NGC.

“For­eign ex­change avail­abil­i­ty af­fects im­port costs, fi­nan­cial plan­ning and coun­try risk,” Long said, not­ing that this type of da­ta is crit­i­cal for busi­ness­es as­sess­ing ex­po­sure in a con­strained forex en­vi­ron­ment.

Long was speak­ing at TTEITI: In­sights for De­ci­sion Mak­ing, a break­fast fo­rum host­ed yes­ter­day by the TTEITI in col­lab­o­ra­tion with the Trinidad and To­ba­go Cham­ber of In­dus­try and Com­merce.

He told the au­di­ence that trans­paren­cy in the en­er­gy sec­tor is not an aca­d­e­m­ic ex­er­cise but a prac­ti­cal busi­ness tool that can help firms as­sess risk, an­tic­i­pate pol­i­cy shifts and make in­formed de­ci­sions in an in­creas­ing­ly volatile en­vi­ron­ment.

Long ex­plained that the Ex­trac­tive In­dus­tries Trans­paren­cy Ini­tia­tive (EITI) is the glob­al bench­mark for trans­paren­cy in oil, gas and min­ing and is of­ten de­scribed as an “ISO for trans­paren­cy”.

He said the EITI frame­work is de­signed to an­swer three core ques­tions. How much do we earn from our re­sources? Who do we part­ner with to de­vel­op them? And do our sys­tems work op­ti­mal­ly to en­sure we get val­ue for our re­sources? Long said.
To an­swer these ques­tions, Long said the TTEITI con­ducts a rec­on­cil­i­a­tion ex­er­cise com­par­ing what ex­trac­tive com­pa­nies re­port pay­ing to the State with what the gov­ern­ment re­ports re­ceiv­ing. Any dis­crep­an­cies are iden­ti­fied and ex­plained by an in­de­pen­dent au­di­tor. The ini­tia­tive al­so fo­cus­es on ben­e­fi­cial own­er­ship dis­clo­sure, iden­ti­fy­ing the con­trol­ling in­ter­ests be­hind com­pa­nies op­er­at­ing in the sec­tor, and as­sess­ing whether tax, au­dit and da­ta man­age­ment sys­tems are de­liv­er­ing val­ue.

He said par­tic­i­pa­tion in the EITI sends a strong sig­nal to in­vestors.
“When a com­pa­ny or a coun­try signs up to EITI, you want to sig­nal that you want the right type of busi­ness­es, those will­ing to dis­close their tax in­for­ma­tion to the pub­lic,” Long said.

He out­lined three strate­gic pri­or­i­ties guid­ing the TTEITI’s work: strength­en­ing do­mes­tic rev­enue mo­bil­i­sa­tion, in­form­ing the en­er­gy tran­si­tion us­ing ESG-re­lat­ed da­ta and tack­ling cor­rup­tion.

Turn­ing to broad­er eco­nom­ic trends, Long said TTEITI’s re­port­ing, which dates back to 2011, al­lows users to track long-term shifts in fis­cal per­for­mance and pol­i­cy out­comes.

“Da­ta sends sig­nals,” he said. “It tells you what’s hap­pen­ing in the tax space, what’s hap­pen­ing in the pol­i­cy space, and it sup­ports ESG analy­sis.”

Us­ing a “bird’s-eye view” of the econ­o­my, Long showed that con­trac­tions in the en­er­gy sec­tor al­most al­ways co­in­cide with weak­er over­all GDP per­for­mance. He point­ed to the swing from a 10 per cent con­trac­tion in en­er­gy GDP in the third quar­ter of 2023 to growth of 6.4 per cent in the fourth quar­ter of 2024.
“These move­ments mat­ter for busi­ness­es. They af­fect con­sumer spend­ing, hir­ing de­ci­sions and in­vest­ment plan­ning,” he said.

De­spite di­ver­si­fi­ca­tion ef­forts, Long said en­er­gy rev­enue re­mains a ma­jor, though volatile con­trib­u­tor, to Gov­ern­ment in­come, dri­ven large­ly by ex­ter­nal fac­tors such as glob­al en­er­gy prices, sup­ply-de­mand im­bal­ances and geopo­lit­i­cal ten­sions.

He al­so high­light­ed the fis­cal bur­den of fu­el sub­si­dies, not­ing that be­tween 2011 and 2025, sub­sidy li­a­bil­i­ties to­talled TT$22.3 bil­lion, even af­ter ac­count­ing for the pe­tro­le­um pro­duc­tion levy paid by crude oil pro­duc­ers. That sum, he said, was equiv­a­lent to nine years of GATE fund­ing. Over the same pe­ri­od, levy con­tri­bu­tions de­clined by 62 per cent due to falling oil pro­duc­tion.

At the firm lev­el, Long said Shell, BP and NGC have been the largest con­trib­u­tors to Gov­ern­ment rev­enue, with Shell over­tak­ing oth­ers in re­cent years due large­ly to ex­tra­or­di­nary “en­hanced rev­enue pay­ments” linked to 2020 ne­go­ti­a­tions.

He al­so drew at­ten­tion to pro­duc­tion-shar­ing con­tracts, not­ing that while Gov­ern­ment prof­it shares gen­er­al­ly cov­ered tax oblig­a­tions at the ag­gre­gate lev­el, deep­er analy­sis showed that some in­di­vid­ual con­tracts failed to gen­er­ate suf­fi­cient val­ue.
“In a coun­try that doesn’t prac­tice con­tract trans­paren­cy, this sends a sig­nal about the val­ue we re­tain from these con­tracts,” Long said.

Al­so ad­dress­ing the fo­rum, TT Cham­ber CEO Vashti Guyadeen said TTEITI’s ver­i­fi­ca­tion work pro­vides con­fi­dence in the in­tegri­ty of en­er­gy sec­tor da­ta. She said more than $2 bil­lion in pay­ments have been rec­on­ciled over 15 years, with un­ex­plained dif­fer­ences of just $4,500.

“Trans­paren­cy da­ta is not just about com­pli­ance,” Guyadeen said. “It is a strate­gic busi­ness in­put.”

She said the Cham­ber part­nered with TTEITI to move “from da­ta to di­a­logue, and from di­a­logue to bet­ter de­ci­sions.”