Photo credit: Luvo Cinematography
The theme of the T&T Energy Conference in 2024 was Accelerating Action. The Energy Chamber picked this theme because there was a strong feeling that the actions needed to create a sustainable future for the sector were known and we were moving in the right direction of travel, but things were simply not happening fast enough.
The Energy Chamber had highlighted in a previous commissioned 2020 study that simply completing regulatory and approval processes faster added significant value to our hydrocarbon resources, which in turn created a much more attractive investment climate. Coming out of the Energy Conference, the Energy Chamber created a new Taskforce made up of younger leaders in the sector, who volunteered to work with the Ministry of Energy on the objective of reducing the time from a bid round to first gas.
Since the Energy Conference earlier this year, all indications are that the pace of delivery within the Ministry of Energy and other key regulatory agencies (in particular the EMA) have significantly accelerated.
At the end of September 2024, the Government and Shell signed a Production Sharing Contract (PSC) for the Modified U (c) block just four months after the close of the shallow water bid round. Even before finalising the PSC, Shell already had in place the environmental approvals to begin a seismic exploration campaign on the block, which they were then able to begin within days of signing the PSC. This is a process that has in the past taken many years to complete, so clearly something is going right.
It is not just Shell alone; bpTT has just announced that they have finished a seismic campaign across the Manakin- Cocuina cross-border gas field, when they (in partnership with NGC) only signed the license for the Venezuela side of the field at the end of July 2024.
The pace of regulatory approvals has clearly significantly accelerated, using an approach where activities are taking place in parallel, rather than waiting for one process to be completed before the next is started. The Energy Chamber’s Taskforce has been sharing methodologies used to fast-track projects in the private sector with colleagues in the public sector, in an effort to make sure that all the steps needed in an approval process are completed robustly, but with minimal delay.
These efforts to increase the pace of delivery are extremely important for the future of all of the energy sector, including the service companies and contractors who work to deliver projects. The quicker a project can get to an investment decision and then to first oil or gas, the better the economics. That means more projects meet the economic thresholds for approval and more work for the local service sector and more gas for the downstream. Accelerating action means a quadruple win for the operators, upstream and downstream, the Government and the services sector.
There are of course many areas where we think things could be improved and move faster, but there is clear evidence that we are seeing some significant progress. The Energy Chamber encourages all players to build on the recent successes and make sure that we continue to accelerate.