GEISHA KOW­LESSAR-ALON­ZO

Se­nior Re­porter

geisha.kow­lessar@guardian.co.tt

A vi­able down­stream sec­tor and in­creased nat­ur­al gas pro­duc­tion are both nec­es­sary for T&T’s en­er­gy fu­ture, US Charge d’Af­faires Philip Kern said, not­ing that each de­pends on the oth­er to sup­port in­vest­ment, growth and long-term in­dus­try sta­bil­i­ty.

Speak­ing dur­ing a net­work­ing re­cep­tion to fos­ter en­gage­ment be­tween T&T down­stream op­er­a­tors and the Na­tion­al Gas Com­pa­ny (NGC) at the US chief of mis­sion res­i­dence in Port-of-Spain on Tues­day evening, Kern not­ed that NGC’s chair­man Ger­ald Ramdeen as­sumed lead­er­ship of the com­pa­ny dur­ing a dif­fi­cult pe­ri­od marked by con­strained gas sup­plies, com­mer­cial pres­sures on the state-owned com­pa­ny and un­cer­tain­ty among down­stream op­er­a­tors over fu­ture gas avail­abil­i­ty, pric­ing and con­tract du­ra­tion.

He ac­knowl­edged that re­cent ne­go­ti­a­tions be­tween NGC and down­stream com­pa­nies had been dif­fi­cult, re­sult­ing in short­er-term gas sup­ply con­tracts than many com­pa­nies would have pre­ferred.

“The last round of ne­go­ti­a­tions was hard,” Kern said adding, “Sev­er­al of the re­sult­ing con­tracts were short­er than they would have pre­ferred. I sus­pect Ger­ald would agree that no­body wants to ne­go­ti­ate the fu­ture of an in­dus­tri­al plant a year or two at a time.”

How­ev­er, Kern said while ne­go­ti­a­tions were on­go­ing, NGC had al­so fo­cussed on ad­dress­ing the longer-term sup­ply chal­lenge.

He point­ed to ef­forts by Ramdeen and his team to strength­en re­la­tion­ships with up­stream pro­duc­ers, ad­vance do­mes­tic gas projects and pur­sue cross-bor­der gas op­por­tu­ni­ties that could even­tu­al­ly in­crease sup­plies to T&T.

“Gas projects take years,” Kern said adding, “But the on­ly way to have more gas avail­able three or five years from now is to do that work to­day.”

The US diplo­mat al­so un­der­scored the im­por­tance of T&T’s down­stream in­dus­try to the Unit­ed States, par­tic­u­lar­ly as a sup­pli­er of fer­tilis­er prod­ucts.

He not­ed that am­mo­nia and urea pro­duced in T&T ul­ti­mate­ly sup­port Amer­i­can agri­cul­ture, mak­ing the coun­try’s petro­chem­i­cal in­dus­try strate­gi­cal­ly im­por­tant to US food pro­duc­tion.

Be­yond its ex­port role, Kern ar­gued that the down­stream sec­tor gen­er­ates sig­nif­i­cant eco­nom­ic val­ue for T&T through tax rev­enues, em­ploy­ment and sup­port ser­vices linked to in­dus­tri­al op­er­a­tions at Point Lisas.

“Gas that goes in­to an am­mo­nia or methanol plant earns rev­enue for NGC. The plant pays tax­es. Its em­ploy­ees pay in­come tax­es,” he said, adding that the in­dus­try al­so sup­ports con­trac­tors, trans­port providers, in­sur­ers, port op­er­a­tions and oth­er busi­ness­es through­out the econ­o­my.

Kern said there was a cred­i­ble ar­gu­ment that, over a full com­mod­i­ty price cy­cle, gas used in down­stream in­dus­tries could gen­er­ate val­ue com­pa­ra­ble to gas ex­port­ed as liq­ue­fied nat­ur­al gas (LNG), al­though cur­rent mar­ket con­di­tions may favour LNG ex­ports.

He stressed the im­por­tance of main­tain­ing a vi­able down­stream sec­tor, ar­gu­ing that it strength­ens T&T’s at­trac­tive­ness for fu­ture up­stream in­vest­ment.

Po­ten­tial in­vestors, he said, ben­e­fit from hav­ing an es­tab­lished in­dus­tri­al mar­ket ca­pa­ble of con­sum­ing new gas pro­duc­tion.

“A healthy down­stream gives new up­stream projects a mar­ket. More up­stream sup­ply gives the down­stream a rea­son to in­vest,” Kern said.

The US Em­bassy, he added, would con­tin­ue sup­port­ing Amer­i­can com­pa­nies seek­ing op­por­tu­ni­ties to in­vest in T&T, pro­vide tech­nol­o­gy and equip­ment, de­vel­op en­er­gy re­sources and build com­mer­cial part­ner­ships.

NGC eyes Ex­pan­sion

Ramdeen, who al­so spoke at the func­tion, re­vealed new an­nounce­ments, the first in­volves the Co­conut gas de­vel­op­ment, a joint ven­ture be­tween bpTT and EOG Re­sources.

He said the NGC has signed a term sheet to ac­quire 100 per cent of EOG’s share of pro­duc­tion from the project.

“The com­ple­tion of this agree­ment will add 300 bcf of gas to NGC sup­ply, which is 300 per cent more than what was orig­i­nal­ly al­lo­cat­ed when the de­vel­op­ment was sanc­tioned,” he said, not­ing that first gas is ex­pect­ed in the third quar­ter of 2027.

“These are the type of de­ci­sions that will pre­serve our down­stream sec­tor and en­sure our na­tion­al pros­per­i­ty in­to the fu­ture.”

Ramdeen al­so an­nounced that ne­go­ti­a­tions with Shell on the Aphrodite gas project have been com­plet­ed and the de­vel­op­ment has now been sanc­tioned, with first gas ex­pect­ed in the sec­ond quar­ter of 2027.

He said the rel­e­vant ques­tion, there­fore, is not whether down­stream still mat­ters.

“It is whether we have the courage and dis­ci­pline to make it mat­ter more,” Ramdeen said adding, “We must take ad­van­tage of the op­por­tu­ni­ty that presents it­self at this mo­ment in time in ways nev­er con­tem­plat­ed be­fore.”

He ar­gued that dis­rup­tions to ma­jor ship­ping routes, in­clud­ing the Strait of Hor­muz and Bab el-Man­deb, have demon­strat­ed how quick­ly en­er­gy shocks could trans­late in­to eco­nom­ic hard­ship, af­fect­ing every­thing from fu­el and fer­tilis­er prices to food costs and in­fla­tion.

Against that back­drop, Ramdeen said the Gov­ern­ment and NGC have em­barked on what he de­scribed as a “de­lib­er­ate re­set” of the en­er­gy sec­tor since 2025, with a fo­cus on re­build­ing the down­stream in­dus­try and strength­en­ing NGC’s role in the coun­try’s gas val­ue chain.