With the Shell acquisition of BG completed, many people in the energy industry have been curious about Shell’s plans in Trinidad and Tobago. While Shell has had over 100 years’ presence in the country, there has been a lot of speculation about how, and even if, Trinidad and Tobago would feature in Shell’s future.
The 2017 Trinidad and Tobago Energy Conference proved to be something of a coming-out event for the new post-acquisition Shell, with keynote presentations by Derek Hudson, Vice President, Shell Trinidad and a detailed company update from Colette Hirstius, GM Developments, Shell Trinidad. Shell was also a major sponsor and had a big presence at the event.
According to Mr. Hudson, the industry is experiencing both a price and a production decline in Trinidad and Tobago. He added that we have no control over the price but we have in our hands the power to stem the production decline. He stated that this is a problem that we must face head on and a challenge that we can overcome. For Hudson, increasing production is crucial to the continued viability of the industry.
He said, “We (Shell) will deliver gas and increase our production over the next coming years through operational excellence, cost competitiveness and portfolio management.” The planned exploration programme both near field and in the deepwater (with BHP) and other new business development opportunities are focused on the future.
Ms. Hirstius pointed out that the BG acquisition was part of a longterm strategy for Shell to grow its integrated gas position as part of its shift towards natural gas in its overall portfolio of assets. She added that BG’s assets in Trinidad and Tobago were one of the assets that were coveted by Shell, as they provide full access to an integrated value chain from upstream, midstream to downstream.
Hirstius highlighted the need to bring more gas onstream quickly and she said that Shell will develop projects with a fast-track approach to unlock near field discovered resources and infield drilling opportunities. She elaborated on the approach for this, and said that the approach will focus on three key areas – the north coast marine area (NCMA), east coast marine area (ECMA) and new exploration.
She envisioned the extension of production life of existing infrastructure in the NCMA via the connection of discovered resources in the short term and the opportunity to produce the cross-border fields with Venezuela as well. She indicated that Shell already had commercial and technical teams working closely with Venezuela, the Trinidad and Tobago government, NGC and Petrotrin to secure Venezuelan production through already existing infrastructure and added that good progress was made last year.
The purchase of Centrica’s remaining assets in Trinidad and Tobago will be complete by Q1 2017, which will allow Shell to have 100% working interest in NCMA 1 block 22 and NCMA 4.
She identified that the main objective in the ECMA was to arrest production decline from existing fields. Hirstius said that in 2017, Shell hopes to finalise plans with Chevron, their joint venture partner, to contract a platform rig for well interventions and an infill drilling programme to be executed as soon as possible. These opportunities she said, rely on a “back to basics” approach with high quality reservoir surveillance and recognising opportunities to increase recovery from existing reservoirs.
Finally, she outlined the third area of interest – “heartland exploration.” This is premised on exploring new leads in the existing Trinidad plays. The intention is to reprocess legacy BG data using new seismic technology and play-based geologic thinking with new workflows and imaging of deeper targets and adjacent acreage with additional exploration potential. She said this would be done to coax more from what exists and to engage in more data acquisition if needed.
Mr. Hudson said that now is not a time to harp on what went wrong in the past. He said that each one of us has a role to play in solving the crisis we are in – the government, the international oil companies (IOCs), the business community, NGOs and suppliers.