Home' Trinidad and Tobago Guardian : February 16th 2017 Contents FEBRUARY 16 • 2017 guardian.co.tt BUSINESS GUARDIAN
ENERGY | BG9
Technology has a fundamental role to play in
supporting the oil and gas industry's recovery,
ITF CEO Patrick O'Brien said in the build-up
to the ITF Technology Showcase in Aberdeen,
scheduled to take place March 1. O'Brien said
that technology can help unlock remaining re-
serves and help the industry work more effi-
ciently to maximise production from ageing
assets. "The downturn has focused minds on
the innovations that can make the biggest and
most rapid impacts," O'Brien commented.
Further championing the effects of technol-
ogy within oil and gas, Petrofac's Geoff Nesbitt
said that there are numerous ways in which
it can underpin long term cost optimisation.
Millions to be spent
energy in Dominica
The Dominica government says it will spend an
estimated EC$45 million (EC$1 =US$0.37 cents) on
the further development of the geothermal energy
Prime Minister Roosevelt Skerrit, addressing a pri-
vate sector forum here last weekend, said that the
funds will come from the controversial Citizenship by
Investment Programme (CBI) through which foreign
investors are provided with Dominican citizenship
in return for making a significant investment in the
socio-economic development of the country.
"We have invested millions thus far and will make
a further investment of EC$45 million in the devel-
opment of the geothermal plant. "I am sure you all
look forward to the significant reduction in the cost
of energy that will follow," Skerrit said.
He said the audience the development of the plant
"will be a positive impact on your businesses and
this should also stimulate investments by others by
establishing new businesses"
Last December, Energy Minister Ian Douglas said
Dominica was moving closer to harnessing geother-
He said the Dominica Geothermal Company had
been registered, and planning of the power plant is
"We are moving ever closer to the vision of realizing
power from our geothermal resources. The Domini-
ca Geothermal Company has been duly registered,
and plans for the construction of the power plant are
progressing satisfactorily," he stated.
"The government has invested further EC$15-mil-
lion into this phase of the project. And we have com-
mitments from our friends in New Zealand, the United
Kingdom, the United Arab Emirates, and the World
Bank, to assist us with the completion of this project."
This follows a decision made by the Government
to run the geothermal project as a company solely
owned by the government and people of Dominica.
Skerrit said that the island should not also forget the
"tremendous devastation" caused by Tropical Strom
Erika in 2015 and that the rehabilitation efforts are
being funded under the CBI.
Crude oil stockpiles are ex-
pected to empty signif-
icantly during the third
quarter as continued pro-
duction restraint from
OPEC interacts with the
seasonal increase in consumption.
OPEC and non-OPEC countries are com-
mitted to reducing production by an average
of nearly 1.8 million barrels per day in the
first six months of 2017, with an option to
extend cuts for a further six months.
Production assessments by independ-
ent agencies suggest compliance with the
agreement has so far been high from OPEC
especially from Saudi Arabia and its allies.
Further reductions from non-OPEC could
be phased in over the next few months, with
Russia in particular committed to increase
its production cuts progressively during the
Set against this is the risk of "compliance
fatigue" if OPEC and non-OPEC countries
become complacent and allow production
to rise towards the end of the period.
Past experience suggests compliance
tends to weaken over time as prices rise and
the panic which made an agreement possible
in the first place fades.
To preserve their flexibility, OPEC and
non-OPEC countries have declined to com-
mit themselves on whether the agreements
will be extended.
But the consensus within the crude market
seems to be that the cuts will be continued
for a further six months, at least in modi-
The alternative would be to flood the
market with more 1 million barrels of extra
crude from the start of July which would
likely increase stockpiles again.
Assuming production cuts are extended
in some form, the biggest impact is likely
to come during the three months from July
Over the last decade, net crude inputs
into US refineries have risen by an average of
840,000 barrels per day in the third quarter
compared with the first.
The third quarter is also when Saudi Arabia
and Iraq increase their own internal con-
sumption of crude to meet air-conditioning
demand. Direct crude combustion in power
plants will cut the amount of crude availa-
ble for export by several hundred thousand
barrels per day from both countries.
Finally, the third quarter is when most
North Sea producers undertake mainte-
nance, which cuts output of Brent and other
grades during the summer.
In sum, the seasonal increase in consump-
tion and reduction in output could combine
to produce a particularly sharp draw down
in crude stocks over the three months from
July to September.
Physical traders will gradually lift their
inventory hedges and sell stocks to refiners
to help meet the shortfall in supplies from
Stocks could draw down faster than
currently expected, in which case the sup-
ply-demand situation would become very
tight in the third quarter. OPEC might re-
spond by allowing production to rise.
On the other hand, growing US shale out-
put, weakening compliance from OPEC and
non-OPEC, and any slowdown in consump-
tion growth could all push back the draw
down in stocks and cause spreads to weaken.
on the road
Technology has 'fundamental role' to play in supporting oil, gas recovery
Links Archive February 15th 2017 February 17th 2017 Navigation Previous Page Next Page