Energy
Caribbean Conference 2007: Conservation
pays off
Port Spain
Petroleumworldtt.com
12 16 07
There
is a market for energy conservation in T&T
and the rest of the Caribbean, according to Andre
Escalante, managing director of Energy Dynamics
Ltd.
Escalante
said that “energy conservation
in T&T is a new industry.”
He said that there are opportunities in this new
industry for businessmen. Some of the areas he
pointed out were retail, engineering services for
consultants, engineering solutions and design product
development.
Escalante
was one of the presenters at the seventh annual
Energy Caribbean Conference 2007 held on
Monday and Tuesday at the Hilton Trinidad and Conference
Centre, St Ann’s.
He said that retailers are people who can get
into the business of selling low-cost solutions
such as electronic timers, compact fluorescent
lamps and sensors.
He
gave the example of fluorescent lamps which he
said are now sold for US$3.50. Escalante says
he can buy them “from Asia for less than
US$1.”
He
said “based on the price of US $3.50
for one, if you have fluorescent lamps running
at your hotels from 6 am to 6 pm every day you
can save US$ 59.13 a year.”
Escalante said that, despite this, when an examination
is done of the Caribbean, there is a need for these
lamps. Yet few people in Trinidad have seized the
opportunity to get into this area of business.
He said that recently the Cuban Government provided
energy saving bulbs for a number of Caribbean islands,
among them Jamaica and St Vincent.
“They even went door to door in distributing
these energy saving bulbs,” Escalante said.
“In
St Vincent they saw a one megawatt drop during
peak hours in the evening time after these
bulbs were installed.”
He used this as an example of how innovative people
can begin sensitising people about energy saving
devices.
“It’s
all about training people in energy conservation.
“When
I started seven years ago I used to tell people
about these new technologies when I
did seminars for the Caribbean Hotel Association.
Nobody knew where to get them so I started to sell
them.”
Escalante said that people need to take the opportunity
to get involved in energy conservation and, at
the same time, create business opportunities.
Despite this he said that there are challenges
in this new industry in the Caribbean.
He said that the first problem is the lack of
awareness among Caribbean people that business
opportunities exist in energy conservation.
Escalante said another problem is the lack of
trained technical personnel. These are the people
who understand the technical problems involved
in the industry and can solve them.
He said that the Government needs to provide a
legal framework that would foster the growth of
the industry.
Escalante said that some of the new government
construction projects may be able use some of these
energy conservation devices. This could become
a model for the private sector, he added.
He
ended by saying that once entrepreneurs take
the step into the industry the opportunities
will
follow. “Energy conservation entrepreneurs
will find little competition and will have the
ability to choose the projects and customers they
wish to serve.”
Energy security an international issue
Energy
security is not the responsibility of one country
alone but an international issue that all
countries must deal with, this according to Stelios
Christopoulos, acting Head of Delegation and Charge
d’Affaires of the European Commission in
T&T.
Christopoulos addressed participants at the seventh
annual Energy Caribbean Conference 2007 at the
Hilton Trinidad and Conference Centre on Tuesday.
“As
we all have noticed, energy prices are at a record
high. This is mainly due to increased
competition for scarce resources. This tendency
poses a serious concern for global security.”
He said that there has to be solutions at local,
regional and international levels.
Christopoulos said that within the global context,
the European Union (EU) is the largest importer
of energy in the world.
He said that the EU had to develop a policy to
ensure that its security needs are met in a competitive
global environment.
He said that the International Energy Agency (IEA)
expects the global demand for oil to grow by 41
per cent by the year 2030.
“In March 2007 we adopted an important policy.
It addressed the security supply of energy...nobody
has an answer for how supply will keep up with
demand,” he said.
He said that this situation has impacted on the
EU internal energy policy and has led to five main
components being developed which will help them
attain their energy goals. These are:
n Increase energy efficiency so that by 2020,
20 per cent of energy will be saved.
n Increase energy use from renewable resources.
Caribbean vulnerable
n Increase the use of green hydrocarbon resources.
n Strengthen the EU carbon market which already
covers 50 per cent of its energy emissions and
represents a market value of more than 20 billion
Euros.
n Continue to enforce a competitive market.
He said that because the EU cannot combat greenhouse
gases and energy security alone it has also developed
an external energy policy.
“The EU policy on energy outside the EU
is closely linked to the development co-operation
policy of the EU because to access modern and affordable
energy services this would have to be a prerequisite
for achieving the Millennium Development Goal for
Poverty Eradication,” he said.
To achieve these goals he said that there are
two tools that the EU has used.
n The EU Energy Initiative for Poverty Education
and Sustainable Development.
n Providing access to modern and affordable energy
services to the poor through direct funding of
projects in regions and countries which need them.
He said that the Caribbean region needs to work
with the EU because it is also vulnerable to high
energy prices.
“Most Caribbean countries are dependent
on import of energy,” Christopoulos said.
He said the region also has to have a policy for
energy security because of its vulnerable position.
“The
answer for the Caribbean is energy efficiency
and renewable energy use.”
He said that the high cost of shipping in the
Caribbean leads to high electricity costs five
times higher than international rates.
“We must work together with actors on all
geographical levels, locally, regionally, internationally
as well as all levels of society including the
state, private actors and civil society.”—RJL
Future’s
bright for Guyana…
after maritime boundary settlement
The Guyana Geology and Mines Commission (GGMC)
said it expects all oil and gas companies which
have interests in a once-disputed maritime border
region between Guyana and Suriname to begin working
speedily on acquiring 2D and 3D seismic data in
the area, now that the border dispute with Suriname
has been resolved.
Fazal Hosein, chief executive officer of the International
Geological Service Ltd, made the point on Monday
during a presentation at the 7th annual Energy
Caribbean Conference 2007. Earlier this year, a
United Nations (UN) Tribunal settled a long-standing
maritime boundary dispute between Guyana and Suriname
which gave both countries access to the Guyana-Suriname
Basin.
The US Geological Survey has estimated the coastal
area of the two nations may hold recoverable oil
reserves of 15 billion barrels and gas reserves
of 42 trillion cubic feet.
“The major implication on the Guyana side
is that CGX has claimed 93 per cent of the area
that was in contention and Suriname has retained
a little,” Hosein said.
“CGX are going to acquire greater than 500
sq km of 3 D seismic in the Corentyne Block, while
for Repsol it will be greater than 1,000 sq km
and Exxon Mobil greater than 2,500 line km through
the seismic,” Hosein said.
“The GGMC would like to see a competitive
bid round. They expect to see within two years
that activity in the exploration phase is completed
and all the blocks will go into a competitive round.
We don’t know at this time where these blocks
are,” Hosein said.
Hosein
said that many companies are now expressing a
growing interest in investing in Guyana because
of that country’s extensive reserves.
“The Guyana Basin is estimated to have 715
billion barrels of oil,” he said.
He
also said that the chances of finding fields
are favourable. Even local companies have invested
in the Guyana’s fields.
The
Trinidad-based Sadhna Petroleum already holds
the 2,000 sq km block x on Guyana’s Atlantic
coastal strip.
The
Sadhna One well site is in close proximity to
the 2,901 foot Yakasuri dry well spudded by
CGX’s local subsidiary,ON Energy, in the
Berbice block in 2005 which has not distracted
Sadhna Petroleum.
He said that there are other prospects in the
Guyana Basin that include Rewa, Pirara River, Annai
and Tamalu.
He said that although the border dispute with
Suriname was solved there is still the border dispute
with Venezuela that exist.
Hosein
said that despite the border dispute with Venezuela,
investors are still forging ahead in
Guyana’s energy sector.
He pointed out that President Chavez had invited
Guyana to be part of the PetroCaribe initiative.
He said that the political stability with its neighbours
has created the framework for greater energy co-operation
regionally.
He said that companies have the view that when
there are political risks that relate to unresolved
maritime borders as well as the normal exploration
risk that can deter them.
However, he said that Guyana is moving beyond
this by providing regional and international companies
with opportunities and less risk because they have
been settling their disputes.
He said that because of these new opportunities,
Guyana is now a place for business people to come
to invest in the energy sector.
Bajans to share in oil wealth
The government of Barbados wants nationals of
that country to be the major stakeholders in all
its energy-based initiatives. This according to
Ron Hewitt chairman of the Barbados National Oil
Company (BNOC).
He said the Owen Arthur government has opted to
adopt a wealth generation system built on citizen
participation, in an effort to protect the well-being
of future Barbadians.
“There
are 270,000 people in Barbados. We want at least
200,000 of them to invest in our
energy initiatives. The cost to invest is minimal;
we want maids, bus drivers and doctors to be stakeholders.
“The
idea is not to raise investment for offshore,
but for Barbadians to have a piece of
offshore. The fund would be administered by Parliament
and managed by the BNOC.”
Speaking to the Business Guardian at the seventh
Energy Caribbean Conference at the Hilton Trinidad
and Conference Centre on Monday, Hewitt said the
wealth generation plan is unique in the Caribbean.
“Future
generations of Barbadians would not be pleased
with us if nothing was put in place
by the present generation for them. By creating
this special purpose vehicle we all will have an
opportunity to invest.”
However, Hewitt said the benefits of the programme
may not immediately benefit the present generation.
He admitted that the framework was yet to be worked
out since the idea is still in the conceptualisation
stage.
The Barbados government has implemented new legislation
to attract major energy companies to engage in
oil and gas exploration.
Revisions have been made to its Offshore Exploration
Petroleum Act and Offshore Exploration Petroleum
Act Rules and Regulations, Hewitt said.
Similarly, a new Tax Royalty Regime is in place.
The new tax regime:
Royalty: Three per cent on oil and gas revenue
Income Tax: 25 per cent (same as corporate tax
rate)
Additional profits tax will be 30 per cent after
US$60 oil and gas US$6MCF
Bonuses & Fees:
Signature, training fee
Domestic supply obligation: Pro-rata share of
production for demand
State participation: Carried interest of up to
25 per cent
Dividend withholding: Tax-standard rate of 15
per cent.
Barbados has 200 wells drilled and 100 of those
wells are in production.
Over the last 25 years, oil production in that
country has been averaged at 1,300 barrels a day
(bpd), while gas production averaged 2.5 million
metric cubic feet (mmcfd) daily.
Hewitt said because of prevailing high oil prices,
the oil industry is in a phase where there is intense
interest in exploration.
Jamaica begins oil, gas exploration
The Petroleum Corporation of Jamaica (PCJ) is
embarking on an aggressive exploration programme
to meet consumption needs in that Caribbean country,
says Dr David Barrett of Finder Caribbean Ltd,
Jamaica.
Speaking on behalf of PCJ consultant, Dr Raymond
Wright on day two of the 7th Energy Caribbean Conference
held at the Hilton Trinidad and Conference Centre,
on Tuesday, Dr Barrett said a new Hong Kong-based
company, Proteam, had successfully negotiated production
sharing arrangements for four blocks.
He said seismic work is coming to an end and the
first well would be drilled within the next two
years.
“Jamaica believes it has tremendous prospects
to find oil and gas in its offshore waters, but
the challenges are many. The exploration company
that is most advanced in respect of activities
offshore in Jamaica is Finder/Gippsland JV. They
hope to drill their first exploratory well possibly
by 2009,” Dr Barrett said.
Of its 20 offshore blocks, 12 are now under license
to two companies.
They are: Finder/Gippsland an Australian joint
venture has exploration licences for five blocks
and Rainville of Calgary, Canada for three.
At present the Finder/Gippsland joint venture
is analysing the economics of transporting gas
from the Walton Basin located on the eastern margin
of the Nicaragua Rise to southern Jamaica.
As a result, a study is being conducted to determine
the volume of gas or oil that would be required
in order to transport by pipeline to an onshore
location, most likely in the vicinity of Port Esquivel.
Jamaica’s
thrust towards energy exploration has not seen
the Bruce Golding government cast
aside environmental concerns by stakeholders.
“A compensation package has been agreed
with the fishing community relating to any interference
with normal fishing activities. The fishing community
can determine the seismic activity and the depth
at which oil and gas exploration can be done,” said
Dr Barrett.
Following a PCJ presentation to industry professionals
in Houston, Texas, back in January, the company
invited informal bids in July. Interested companies
were required to bid on a production sharing arrangement
with or without royalty.
Under
Jamaica’s Petroleum Act, the PCJ has
full authority to determine how bids are conducted,
said Dr Raymond Wright.
“Unlike T&T and Barbados, all operations
in relation to oil and gas are done with the PCJ.
When the Act is revised the State could become
more involved in the link between exploration licence
and production,” he said.—SN
Story
by Raphael John Lall from
The Trinidad Guardian
The
Trinidad Guardian
Thursday 13th December, 2007
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