The first-quarter results of one major gas producer in Trinidad and Tobago indicate roughly a 15 percent drop in the price for natural gas contracted to the domestic market compared to 2014.

In a press release on their first-quarter results, EOG Resources, the country’s third-largest gas producer, reports that their first-quarter average gas sales price in Trinidad was US$3.09 per mmscf, compared to an average of US$3.65 in 2014 (according to their annual report).

EOG Resources, along with BHP Billiton, sells all of their gas under contract to the National Gas Company (NGC), which in turn markets this gas primarily to the petrochemical producers in Point Lisas.

The price of gas under these contracts is indexed to both commodity prices for methanol and ammonia and to U.S. Henry Hub gas prices.

The two biggest gas producers, bpTT and BG T&T, sell gas to the NGC under long-term contracts and to international customers as LNG, via Atlantic.

While bpTT does include average natural gas prices in their annual report, these are not disaggregated by whether the gas is destined for domestic customers or sold as LNG to export markets. BPTT’s average Trinidad and Tobago selling price in 2014 was US$4.65, only marginally down from the 2013 average.

When the Prime Minister of Trinidad and Tobago announced that the national budget was being recalculated in January 2015, she stated that the new budget was based on a revised oil price of US$45 per barrel (down from the previous budgeted price of US$80) and a wellhead natural gas price of US$2.25 per mmbtu (down from US$2.75).

In his response to Moody’s downgrade of Trinidad and Tobago’s investment rating from Baa1 to Baa2, the Minister of Finance noted that for the first two quarters of fiscal 2015, the country had run a budget surplus.

He pointed to better-than-anticipated revenue from natural gas sales as one of the reasons for this better-than-expected performance, contrasting this to the emphasis on oil prices in the Moody’s report. However, the Minister did not present any actual figures on the realised gas prices in Trinidad and Tobago.

Energy Chamber calculations indicate that approximately one-third of Government revenue from hydrocarbon production comes from oil and two-thirds from natural gas.

Note: The conversion between mmscf (a measure of volume) and mmbtu (a measure of energy content) varies depending on the quality of the gas, but is approximately equal.