Home' Trinidad and Tobago Guardian : January 21st 2016 Contents Despite the challenging circumstances, T&T s
energy sector is not dead and has a long life
ahead of it, says Vincent Pereira, chairman
of the T&T Energy Chamber.
"There are many exciting opportunities that lie ahead,
including the upcoming deepwater exploration campaign. If
we go about a process of structural adjustment over the next
few years in a sensible and focused manner, we will come out
of this current challenging period stronger than when we went
in," he said, speaking in his contribution to the T&T Energy
Conference which ended yesterday at the Hyatt Regency in
Pereira said the current crisis, which was brought about by
low commodity prices, has the potential to create significant
transformation for T&T s economy and society.
He said the adverse environment has shown the vulnerability
of T&T s small, open hydrocarbon-based economy just as it
has shown up the weakness of other natural resource-based
economies. He added that the boom in energy prices trans-
formed T&T s economy during the 1990s through to the late
2000s but now the country has reached another stage and
needs to transform itself for this new era.
Pereira said, while past oil and gas booms had propelled
T&T into wealth, the latest collapse of oil prices raises questions
Commenting on problems in the gas sector, he said: "T&T
has continued to suffer from shortfalls in gas production, with
knock-on effects on LNG and petrochemical exports. Gas
production from January to October 2015 averaged 3.8 bcf per
day---a 12 per cent drop from our peak year of production."
Given the nature of the upstream sector, he said, increasing
gas production---or even just maintaining it---will require sig-
nificant new investment in drilling and the construction of
the gas delivery infrastructure to attract the capital investment
Pereira said T&T has attracted significant upstream foreign
direct investment (FDI) over the past years which has now
enabled substantive ongoing development and exploration
"Within just the last six months alone, 22 major projects
worth upwards of $50 billion and $7 billion bbl of commercial
reserves have been delayed pre-FDI. Here, in T&T, there are
at least four major upstream gas projects under development.
Additionally, there is a substantive exploration programme
ongoing and ramping up both shelf and deepwater," he said.
This investment takes place in the context of intense com-
petition for capital with there being "too many projects chasing
too little capital."
Pereira called on the Government to ensure there is an
energy policy that attracts foreign investment and not one
that scares away what little foreign investment may exist
outside of T&T.
He said there is almost nothing the country can do about
international prices but the Government can ensure that
policies are right to attract investment.
"The last thing the country would want to do is to make
policy decisions that make investment less competitive and
hence encourage the flow of scarce capital to other destina-
Pereira said there has been an increase in efficiency in the
local energy sector.
"Operators and service companies have been in dialogue
about how to improve efficiency and innovative ways of cutting
costs. Although we have taken some ground, my sense is that
there are still significant productivity and efficiency opportunities
we must access to ensure the competitiveness of our indus-
He referred to Prime Minister Dr Keith Rowley s speech at
the end of December where he spoke about the importance
of the economy being competitive.
"For a small, open economy like T&T s, diversification essen-
tially means diversification of our exports. We have to focus
on economic policies, on helping our companies sell a more
diversified range of goods and services to the rest of the world.
Competitiveness is, therefore, absolutely key to any discussion
Pereira added that T&T s energy service companies have a
vital role to play in diversifying the economy. Many of these
companies already meet the high international standards
demanded by the global oil and gas industry. He drew the
example of the recent Liza oil discovery in Guyana which rep-
resents a significant opportunity for T&T s companies but
qualified this by saying that our companies need the right
partnerships in the public and private sectors.
Pereira also raised the sore issue of foreign exchange avail-
"We have to be conscious about preserving our foreign
exchange and importing less. That is where local content can
play an extremely important role in national economic pol-
Noting this year marks the 60th anniversary of the Energy
Chamber in T&T, Pereira said, through the decades, the group
has faced and overcome many challenges.
"I am confident that given the strength of the Energy Cham-
ber today, we will not only overcome the present challenges,
but we will make a strong contribution towards ensuring that
our nation emerges from this current storm with a stronger
and more robust economy."
JANUARY 21 • 2016 www.guardian.co.tt BUSINESS GUARDIAN
NEWS | BG7
Energy Chamber's Vincent Pereira:
sector not dead
Investment takes place in
the context of intense
competition for capital;
too many projects
chasing too little capital.
Vincent Pereira, chairman of the T&T Energy Chamber, left, walks with Norman Christie, regional president of bpTT, and Colm
Imbert, Minister of Finance on January 18, the opening day of the 2016 T&T Energy Conference, held at the Hyatt Regency in
Port-of-Spain. PHOTO: ABRAHAM DIAZ
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