Home' Trinidad and Tobago Guardian : August 8th 2013 Contents The results of this year s Ryder
Scott audit emphasises that
even while T&T s proven
reserves declined marginally,
the country maintained a
reserve level of almost 100 per
cent for the second consecutive year.
This was a result of increased seismic, drilling
and appraisal programmes. (Refer to Figure 1).
The Energy Chamber therefore believes the
outlook for T&T s upstream sector is positive
and consistent upstream exploration activity
and fiscal regime reform will improve the per-
formance of the T&T energy sector.
While proved reserves declined in 2012, the
size of the decrease was marginal (0.151 trillion
cubic feet (tcf)). In 2012, proved reserves
declined by approximately 1.1 per cent, whereas
in 2011 proved reserves declined by 1.5 per
cent. This marginal decrease is due in part to
bpTT s 1.0 tcf Savonette discovery. With 1.41
tcf used in 2012, the Savonette find is respon-
sible for 71 per cent of proven reserve replace-
ment in that year.
The level of probable reserves increased by
0.107 tcf while possible reserves declined by
0.171 tcf and the country s unrisked exploration
potential is estimated at 31.6 tcf of gas. (Refer
to Figure 2).
The chamber would like to emphasise that
these results only took into consideration
reserves in shallow water blocks. The blocks
excluded from the study are NCMA 2, NCMA
3, Block 4B, 5d and the deep water blocks
TTDAA 14 and Block 23A.
Production sharing contracts have been
signed between Government and upstream
companies for all these blocks, and there are
already clear exploration programmes in place.
This implies there is a possibility for our reserve
base to be higher than what was indicated in
the audit. Furthermore, the entry into the
uncharted deepwater by bpTT and BHP Billiton
shows this confidence is not only far-reaching,
but deep rooted as well.
Over the next 24 months, several companies,
including Niko Resources, Centrica Energy,
bpTT, BG T&T, BHP Billiton and EOG
Resources, will engage in seismic, exploratory,
appraisal and developmental drilling pro-
grammes. The planned expenditure of oper-
ating companies is proof of their confidence
in T&T s proven resource potential. These
companies plan to spend in excess of US$2
billion in T&T in the upcoming fiscal year and
over the next five years, bpTT alone will invest
The recent signing of production sharing
contracts for deep water acreage, the success
of the 2013 onshore and deepwater bid rounds
and the planned 2014 shallow/average depth
bid round, all send positive signals that our
reserves may follow an upward trend.
These developments reiterate that T&T is
not running out of natural gas and that com-
panies have a positive outlook on our reserves
Both the Energy Chamber and the Govern-
ment agree that in order to replenish our
reserves, an average of nine exploratory wells
must be drilled.
In the past 18 months, there has been a
marked increase in exploration as well as devel-
opmental drilling. Between 2011 and 2013,
drilling activity and rig rates have been at their
highest levels since 2006. These are good indi-
cators of buoyancy in the upstream sector.
Moreover, the intention of bpTT to fabricate
the topside and jacket for the Juniper platform
in La Brea bodes well for employment in our
local energy services sector.
The Energy Chamber believes continuous
activity in the upstream sector is critical to
improving our reserves base. The local
upstream, mid-stream and downstream gas
industries are inexorably linked and develop-
ment plans need to examine the entire value
chain. In the recent past, the downstream has
suffered from curtailments in gas supply as a
result of maintenance in the upstream.
Potential investors in downstream gas-based
industries need re-assurances on gas availability
for their projects, and building confidence in
the country s reserves base will send positive
signals to downstream operators. In addition,
continued fiscal regime reform will not only
enhance our country s competitiveness, but
also attract the investment necessary to
increasing T&T s reserves base.
These variables make planning and achieving
a balance between the competing gas demands
pivotal as we attempt to place the energy sector
on the path of sustainable growth.
For more information, please contact the
research team at: 679-6623 or visit us at:
BG18 | COMMENTARY
BUSINESS GUARDIAN www.guardian.co.tt AUGUST 2013 • WEEK TWO
likely to increase
natural gas reserves
Continued fiscal regime
reform will not only
enhance our country's
competitiveness, but also
attract the investment
necessary to increasing
T&T's reserves base.
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