Changing
direction for natural gas
By Juhel Browne
Trinidad Express
Port Spain
Petroleumworldtt.com
08 26 07
A
new course is being charted for Trinidad and
Tobago's
bread and butter energy sector against
the back drop of the increasing cost of oil and
natural gas exploration and questions over remaining
reserves.
It is now costing an average of US$50 million
to US$75 million to drill just one exploration
well as the upstream energy sector companies say
that they are drilling for fields of reserves that
will not be as large as has usually been the case.
More than a week before Prime Minister Patrick
Manning delivered the 2008 Budget presentation
in the Parliament on Monday, he hinted at a energy
new policy during a People's National Movement
(PNM) public meeting in Maloney on June 27.
"After so many years of a particular policy
and the changes that are taking place internationally
and domestically, the time has come for the PNM
and the people of Trinidad and Tobago to review
the directions we are taking on oil and gas and
to see whether new directions are called," Manning
said.
At
a public consultation on food prices last week,
Manning said the Government planned to replicate
its success in the oil and gas sector in agriculture
with the intention of making the production of
food "as important as energy in new century."
One century to another
Next year marks the 100th anniversary of commercial
production in Trinidad and Tobago.
It has now 150 years since the drilling of the
first well for oil took place in the vicinity of
the Pitch Lake in La Brea.
The
Government had first outlined its policy position
on natural gas in the "White Paper on Natural
Gas" published in 1981 which acknowledged
the tide was shifting with regard to oil's dominance
as the nation's main revenue earner.
At an energy conference hosted by the Government
early last week at the Hilton Trinidad, hotel,
St Ann's, Manning recalled the prophetic message
in the White Paper on Natural Gas.
"Policy makers (then) targeted the achievement
of certain objectives emphasising that "the
future of the national development programme is,
even at this time (1981), inextricably tied to
the definition of the country's gas reserves and
the timely production and efficient utilisation
of these reserves"," Manning said.
Supply and demand
Just three days before the conference, Energy
Minister Dr Lenny Saith held a press conference
with senior Energy Ministry officials who formally
announced the findings of an audit of the nation's
gas reserves that showed the nation only had there
were only 12 years of supply left.
However, the gas audit, conducted by the well
respected Houston-based firm Ryder Scott, identified
37 trillion cubic feet (tcf) of natural gas for
exploration.
The Ryder Scott team had delivered a presentation
to the Standing Committee on Energy, which Manning
chairs before the PNM public meeting.
By that time, there were newspaper reports that
said the Ryder Scott audit painted a grim picture
of the nation's gas reserves, just as the Government
was preparing the Budget for the 2007/2008 financial
year.
At
the energy conference last week, Manning in an
apparent response to those calling on the Government
to scale back its energy sector pursuits in the
face of the Ryder Scott audit said, "Every
step backward could send the wrong message to stakeholders,
investors, businessmen, labour leaders and the
general public."
The stakeholders who spoke at the conference which
Manning chaired on both days, were mainly those
representing the upstream energy companies who
actually go and extract the oil and gas from land
and marine fields.
They included the executives of bpTT, British
Gas, BHP Billiton and PetroCanada.
While they dismissed of any notion there is only
12 years of natural gas left, they warned the Government
needed to provide the right incentives for exploration
and measure its activities in the downstream sector.
Manning acknowledged the need for improvements
in the fiscal regime for oil and gas exploration.
He said all of the information presented at the
conference will be considered in the preparation
for the 2008 Budget, as he made a surprise announcement
that his presentation of the fiscal package had
been scheduled for Monday.
It was clear the Ryder Scott audit, the energy
conference and the public consultation on food
prices set the stage for a new chapter in the energy
sector.
Trinidad
Express
Wednesday, August 22nd 2007
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©2007 Trinidad Express. All Rights Reserved.
