Govt
ignoring troubling energy issues
While it is great to see that the Ministry of Energy has decided to clarify
the issue regarding natural gas reserves in a full-page ad, the truth is that
other than confirming the reserves figure for January 2005, there is little
that is not already in the public domain.
Not many people have a problem with the Government's
policy to diversify the use of natural gas away
from LNG and to deepen the country's cut in the
gas value chain.
What
the Government ignores is that concerned observers
focus on a number of troubling issues
that might affect its ability to get the planned
programme off the ground, and the long-term value
of the projects to T&T.
-
Current Reserves-One key area of concern is that
of gas reserves. Based on simple sums, the
gas consumption used in the ad calculates at 1.743
tcf of gas per year being taken out of the ground.
If this figure is used against the "proven
reserves" only, stated at 18.774 tcf, the
proven reserves will support the current and approved
projects commercially for only 10.8 years at the
above rate of demand. Cross-border unitisation
of the fields shared with Venezuela would add a
new dimension to the whole formula but must be
considered as a long-term part of any programme
to increase available reserves and one rife with
potential political risk.
- Additional Reserves- The ministry has outlined
an aggressive-sounding exploration programme but
failed to say how many of the wells specifically
target gas and how many oil.
- The Environment- Instead of engaging constructively
with the smelter protestors the government has
added fuel to the fire and hardened the lines of
engagement.
- Value for Money-Is the energy plan going to
maximise the national take of the profits? There
is an intricate courtship between the Government
and the producers since gas sold to NEC/NGC only
provides a small profit margin to the producer
compared to what they would get if the same gas
went in to LNG where the value space the operators
participate directly in is much larger.
If the Government does not follow the intricate
dance steps scrupulously they cannot expect support
from the operators. A misstep could impact negatively
on the speed at which new reserves are brought
on to production by the same operators.
- Use of the Money-Is the Government doing enough
to ensure that when the gas and oil runs out that
the non-oil sector will be able to sustain our
standards of living and provide for the growth
that is essential for ensuring sustainability?
Nigel Darwent
Maraval
Trinidad
Express
Thursday,
May 17th 2007
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©2006 Trinidad Express. All Rights Reserved.
