Despite an uptake in activity in 2018 with new drilling programmes coming on stream, local companies are not feeling optimistic about their business prospects. Service companies are also feeling a downward pressure on their margins from the operators despite an increase in commodity prices. This might be leading to the low levels of optimism still felt by service companies.
In 2017, Trinidad and Tobago saw its first electric vehicle on the road. It was actually an electric bus which was made possible through a partnership with the University of Trinidad and Tobago, the European Union and the Ministry of Planning (formerly the Ministry of Environment). Recently, other electric vehicles have been launched.
Industry collaboration has become an important focus for companies in the energy sector as they adjust to the lower price environment of the past few years. Companies have recognised that while they will compete in many areas of their business, there are also many areas where they can collaborate in order to maximise the value of their business. This can include collaboration between operators, between service companies and operators (or with each other), between academia and the industry, or collaboration between state agencies and the industry. There are also opportunities for collaboration across international borders to find mutually beneficial solutions.
In early January, Exxon Mobil Corporation announced positive results from its Ranger-1 exploration well, marking ExxonMobil’s sixth oil discovery offshore Guyana since 2015. The Ranger-1 well discovery adds to previous world-class discoveries at Liza, Payara, Snoek, Liza Deep and Turbot, which are estimated to total more than 3.2 billion recoverable oil-equivalent barrels. ExxonMobil affiliate, Esso Exploration and Production Guyana Limited, began drilling the Ranger-1 well on November 5, 2017 and encountered approximately 230 feet (70 metres) of high-quality, oilbearing carbonate reservoir. The well was safely drilled to 21,161 feet (6,450 meters) depth in 8,973 feet (2,735 meters) of water.
Successful plant maintenance turnarounds in the downstream petrochemical and heavy industrial sector are key to the successful longterm operation of facilities. These turnarounds (or TARs as they are commonly called in the industry) are also key business opportunities for the myriad of service companies and contractors who support the industry. TARs are also important for the thousands of contract workers who pick up temporary employment during these periods, often working long hours and accumulating significant overtime income.
Ammonia prices have rebounded. This rebound comes after a low in August when it dipped below 150 US$/tonne. According to the Food and Agriculture Organisation (FAO), the price continued the upward trend at the end of the year due to lower supplies in the Black Sea where portions of ammonia were diverted to produce urea.
Earlier this month, Prime Minister, Dr. the Honourable Keith Rowley, delivered an address to the nation. While the address touched on several economic issues facing the country, there was specific mention of the future of the energy sector and in particular, the role that the state oil company, Petrotrin, plays in the economy. Dr. Rowley stated, ‘Petrotrin has contributed significantly to the growth and development of Trinidad and Tobago but is now in need of fundamental restructuring, which cannot be put off any longer’.
It gives me great pleasure to welcome you all to the Trinidad & Tobago Energy Conference 2018, and especially to welcome all of our regional and international visitors. Over the past thirty years this conference has grown to become the premier event in the regional energy sector calendar. It is the one time when the whole industry comes together to discuss the challenges and the opportunities for the sector.
Despite the fact that upstream activity is set to increase in 2018, most service companies operating in Trinidad and Tobago report that they are still not confident about their business prospects and future growth. The Energy Chamber of Trinidad and Tobago’s (Energy Chamber) quarterly survey of energy service companies shows that over 60 per cent of companies report that both the volume and value of their business was below normal levels with around half of the companies surveyed reporting that they reduced staffing levels in the fourth quarter of 2017.
The Energy Chamber has commissioned an independent study to better understand the current value of the energy sector to economy of Trinidad & Tobago, as well as to determine where opportunities exist to increase the value in the future. The Energy Chamber has contracted the respected Washington D.C.-based consulting group, DAI Sustainable Business Group (SBG), to undertake this study and quantify the contribution of the energy sector.
Low hanging fruit’ is a term that is frequently used in the discussion around energy efficiency. In its simplest form, it means that the cheapest way to save money on energy is to use less energy. However, using less energy can sometimes be equated with producing less; this is not what we mean by using less energy — what we really mean is doing the same activities and maintaining the same production while using less energy, thereby becoming more efficient.
The recent “fake oil” allegations at Petrotrin has helped propel public discussion on how efficiently the country monitors its oil and gas production. For better or worse, the issue has generated not only salacious stories in the press but actual interest in the existing checks and balances to monitor production. It is clear that the ramifications of lax monitoring can be crippling. In fact, there are billion dollar ramifications if the country does not correctly quantify its energy production, particularly in this current environment of low global oil and gas prices and declining national production.
If Trinidad and Tobago is going to continue to attract the massive amounts of direct foreign investment it requires to maintain its world-class natural gas industry, the country needs to ensure that there is clarity on both short and long-term energy policy. To attract investment, the country needs to reduce uncertainty and help investors mitigate risk.
Well-deserved and hearty congratulations are extended to Process Components Limited (Procom) and Massy Technologies Applied Imaging (Trinidad) Ltd. who each got a perfect score of 100 per cent in each Safe TO Work (STOW) element at their 2017 recertification audits. STOW is a certification programme for contractors’ health, safety and environmental (HSE) management systems (MS) which involves contractors implementing the locally developed STOW HSE requirements and undergoing an independent audit to verify compliance to the requirements.
Recent news suggests that the island of Grenada may now become the newest hydrocarbon-producing nation in the Caribbean region. A wildcat exploration well, called Nutmeg 2, was spudded by Global Petroleum Group (GPG), a little-known Russian company in late June. The well, located in about 400 feet of water near to Grenada’s maritime boundary with Venezuela, was drilled using the Transoceanowned semi-submersible Development Driller III.