In the face of revelations of hundreds of millions of dollars in losses on failed projects, the Chairman of the National Gas Company (NGC) Conrad Enill has denied that the company was reckless in its investment in Atlantic LNG Train 1 and its $200 million investment in the Beachfield project which it later realised was not necessary.
In a full page advertisement in today’s Sunday Guardian, Enill insisted that even though the company lost close to a half a billion dollars on two failed projects in the last three years it was done after careful analysis.
“Each of those decisions was approached with the same rigour, with the same analysis of risk and return, and in compliance with established policies and procedures.”
Enill said over the years, the boards, presidents and leadership teams at NGC have been presented with opportunities to create value for Trinidad and Tobago and made informed decisions based on available data and projections in a volatile and uncertain environment, always with a strategic lens on future impact.
Some of these investments the NGC chairman asserted would have had to be made, did not necessarily produce expected outcomes due to changing circumstances and this is the nature of risk, which any entrepreneur or profit-driven company will appreciate.
He insisted that calculated risks are necessary for growth, and every success that NGC has achieved has involved a measure of risk.
“To suggest that decisions that did not bear out intended results were reckless decisions is to deliberately ignore the uncertainty that comes with making any investment that extends into the future, particularly in our commodity-linked business governed by rapidly changing external markets.”
Enill noted that over the past few weeks, the Trinidad and Tobago media have reported on “mismanagement” of NGC but said while the NGC supports public education and information it was concerned about the focus on the failed projects.
“It is unfortunate that the focus should be on specific outcomes that did not deliver expected returns, rather than highlighting the positive investments that have positioned NGC for growth and success in an evolving energy landscape. These include stability of the sector at a time of significant decline, reduction in liabilities and exposure in the future, getting value across the entire energy value chain, and preparing for a green future.”
The NGC Chairman said while the company supports the role the media plays and respects its importance in reporting on issues of national interest, it holds an often-unmet expectation that in fulfilling that role, the media would commit to balanced reporting.
“Articles which present partial, uncontextualised details represented as a complete analysis, can be misleading and destructive,” the statement read.
Business Guardian and Sunday Business Guardian broke the stories that showed the NGC investing and potentially losing more than a quarter billion dollars in a failed attempt to restart the Atlantic LNG Train 1 plant, relying on natural gas that was already committed to the petrochemical sector and having no real prospect of getting the gas in the short-term that is necessary for the plant to restart.
The Business Guardian also revealed that the NGC threw away another $200 million behind a low pressure gas project in Beachfield which was discovered to be unnecessary and it was left holding the bag including $100 million worth of compressors that it cannot now sell.
Enill said the NGC recognises that it must always act in the national interest for the people of Trinidad and Tobago and play a key role in the management of the country’s natural gas resources and associated business pursuits.
“We appreciate the need for complete transparency and accountability and adhere to strict governance protocols. We maintain a balanced approach, which does not compromise our leverage for the future or closing opportunities to increase stability and growth.” Enill said in the statement.
He said the NGC reinforced its governance framework over the past three years to align it with the highest international standards.
The NGC chairman noted that as a responsible state enterprise the company commits to and has adhered to reporting on its business to the public through appropriate governance channels and not through the media.
The NGC chairman claimed that the media’s use of confidential information undermines the company and country.
“We encourage the media to be more responsible in their reporting. Unauthorised disclosure of sensitive and confidential information undermines commercial partnerships and can make our country appear less attractive as an investment location and impact the brand of the country at a pivotal time in our country’s global energy growth,” said Enill in the full page statement in the newspaper.
“NGC continues to work resolutely to build a sustainable future for our industry and our country, with the best interest of our people firmly in focus. The diligent work and unrelenting commitment of the men and women of the NGC Group have underpinned our resilience, as they continue to demonstrate their adaptability to handle all challenges put to them. We encourage all to promote productive discourse which includes all sides in the discussion. The Board and President of NGC affirm: We are committed leaders. We stand by our Company and our decisions, confident that the net result of our work is a stronger NGC, delivering ever greater value,” the statement ends.