Home' Trinidad and Tobago Guardian : September 26th 2013 Contents SEPTEMBER 2013 • WEEK FOUR www.guardian.co.tt BUSINESS GUARDIAN
NEWS | BG7
The contribution of the petroleum industry to the
gross domestic product (GDP) of T&T is expected
to decline for a fourth consecutive year since 2010,
according to the Review of the Economy 2013, one
of the documents published together with the
2013/2014 national budget.
The Ministry of Finance and the Economy s provisional number
for the petroleum industry s contribution to GDP in 2012 was
$35.2745 billion, down from $35.644 billion in 2011 and $37.0912
billion in 2010.
Although the ministry estimates a $35.4371 billion contribution
from the petroleum sector to GDP in 2013, as a percentage, the
decline is expected to be from 40.2 per cent in 2012 to 39.7 per
cent in 2013. In 2010, the petroleum industry contributed 41.7
per cent of GDP and 41.1 per cent in 2011.
The review said: "T&T s real GDP is expected to grow by 1.6
per cent in 2013, a marginal improvement on its estimated 1.2
per cent expansion in 2012. This stronger performance reflects
an anticipated expansion of 2.5 per cent in the non-petroleum
sector, supported by positive, albeit flat growth of 0.5 per cent
in the petroleum sector."
"The petroleum sector is projected to return to positive growth
in 2013, with a marginal expansion of 0.5 per cent, following
successive contractions of 3.9 per cent and 1.0 per cent in 2011
and 2012, respectively. Notwithstanding this turnaround, a slight
decline is anticipated in the sector s contribution to real GDP,
from 40.2 per cent in 2012, to 39.7 per cent in 2013," the review
The mildly positive performance in the petroleum sector in
2013 is predicated on the continuation of heightened upstream
exploration and development activities, and higher production
levels for natural gas, liquefied natural gas (LNG) and methanol,
the Ministry of Finance and the Economy said. These should
slightly outweigh lower crude oil, condensate, ammonia, and
urea output, it said.
"Exploration and development activity has increased in recent
years and this momentum is expected to continue during 2013,
with six rigs currently drilling in T&T, and possibly a seventh
rig being introduced before the end of the year. A rise in natural
gas production is expected during 2013, as higher production
levels were recorded during the first four months of the year.
"Additionally, the impact of the planned shutdowns in Sep-
tember 2013 is expected to be significantly reduced as a result
of successful negotiations between government and the upstream
producers. LNG production is also expected to rise compared to
2012 on account of improved natural gas supplies. In this regard,
the industry has already reported strong growth in early 2013,"
the Finance Ministry said.
Decline in exploration wells
The Government expects the petrochemicals industry (ammonia,
urea, methanol) "to register a mixed, but improved performance
in 2013 as upstream supply constraints ease. This follows the
industry s generally negative performances during the 2010-2012
period. The secular decline in crude and condensate production
associated with maturing oil fields, and the disposition towards
the production of mostly dry natural gas was expected to
continue in 2013, even as crude output appears to be stabilis-
Petroleum companies drilled a total depth of 87,200 metres
over the period October 2012 to May 2013, the review said. This
represented a 5.7 per cent increase from the 82,500 metres drilled
during the comparative period of fiscal 2011/2012. A 14.5 per
cent increase in onshore drilling (from 38.8 thousand metres to
44.4 thousand metres), which outweighed a 2.1 per cent decline
in offshore drilling (from 43,700 metres to 42,800 metres),
provided the main impetus for the increase in drilling activity.
A total of 64 wells were drilled during the first eight months
of fiscal 2012/2013, which was 7.2 per cent less than the 69 wells
drilled one year earlier. Sixty-two wells were for development
(down from 64), and two wells were for exploration (down from
five), marking decreases of 3.1 per cent, and 60.0 per cent,
respectively, according to the document.
Notwithstanding the marginal decline in the number of devel-
opment wells, development drilling increased by 16.3 per cent
to 80,700 metres (from 69,400 metres, one year earlier), with
regard to total depth drilled.
The sharp decline in the number of exploration wells was,
however, reflected in the total exploratory drilling depth which
declined by 50.2 per cent to 6,500 metres (from 13,100 metres)
during the period under review.
Development drilling refers to drilling conducted to determine
more precisely the size, grade, and configuration of a mineral
deposit, subsequent to when the determination is made that the
deposit can be commercially developed. It entails drilling for
hydrocarbons in an area with proven reserves to a depth known
to have been productive in the past.
Exploratory drilling refers to drilling conducted in search of
an undiscovered reservoir of oil or gas. It involves drilling several
test holes to determine the location of mineral deposits, in an
area where little sub-surface data about those minerals is avail-
Production of crude and condensate totalled 19.7 million barrels
during the period October 2012 to May 2013, representing a 4.3
per cent decline from the 20.6 million barrels produced in the
corresponding period one year earlier, the ministry said. This
outcome was precipitated by a 25.6 per cent decline in condensate
production (from 3.9 million barrels to 2.9 million barrels), which
outstripped a 0.6 per cent expansion in crude production (from
16.7 million barrels to 16.8 million barrels). The extraction of
drier natural gas from new and existing natural gas reservoirs,
accounted in most part for the lower condensate yield during
the period, the review said.
Offshore crude and condensate production declined by 11.3
per cent to 14.0 million barrels during the eight-month review
period, whilst onshore production increased by 18.9 per cent to
5.7 million barrels. As a consequence, the share of total crude
and condensate which is produced onshore rose to 28.7 per cent
from 23.1 per cent, and the share produced offshore fell to 71.3
per cent from 76.9 per cent.
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