Home' Trinidad and Tobago Guardian : October 3rd 2013 Contents BG10 | NEWS
BUSINESS GUARDIAN www.guardian.co.tt OCTOBER 2013 • WEEK ONE
"While Petrotrin was investing $2.7 billion in the
failed gas-to-liquids (GTL) project and $14 billion in
the gasoline optimisation programme (GOP) project,
Trinmar was being starved," said Energy Minister
Speaking in Parliament on September 23, Ramnarine
said, "In 2004, production at Trinmar was 35,000
barrels of oil per day. By 2010, it had collapsed to
22,000 barrels of oil per day. That is what I call the
Trinmar tragedy, the Trinmar tragedy. We now hear
about oil production in decline. What about the Trin-
mar tragedy? What was happening in Petrotrin under
the PNM was akin to economic genocide.
"Our friends opposite will not talk about that. I
am pleased to report that we have stabilised Trinmar s
decline and we have started to increase output. The
latest figure shows that we are now averaging around
23,000 barrels of oil per day and should be averaging
23,500 by the end of the year.
"Many speculate as to why the PNM ran Trinmar
into the ground, or should I say into the sea. Trinmar
was left for dead. This is a critical national asset. We
have set about fixing Trinmar," Ramnarine said.
Ramnarine also gave six reasons for the fall in crude
"The six main reasons for the decline of oil pro-
duction from 144,000 barrels of oil per day in 2006
to 82,000 barrels per day in 2012 are:
1. Faster than expected decline of the BHP Angostura
2. The rapid collapse of production at Trinmar;
3. The decline in condensate a production from
BP;4. Lack of strategic focus by Petrotrin on oil pro-
5. Inadequate fiscal incentives to stimulate invest-
6. Inability of the private sector to access oil-
bearing acreage for investment.---ALEEM KHAN
"We have arrested the decline in oil pro-
duction because oil production in 2013 will
average roughly what it averaged in 2012,"
Energy Minister Kevin Ramnarine said in
Parliament on September 23.
In its most recent Review of the Economy
published together with the September 9
national 2013/2014 budget, the Ministry of
Finance and the Economy reported: "Pro-
duction 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
Ramnarine was speaking during the debate
of the Appropriation Bill 2013 for the 2014
financial year. The Energy Minister was
recounting the achievements of his Gov-
ernment in the energy sector, after having
to explain more on the cross-border gas
field agreement with Venezuela, governing
the Loran-Manatee field.
He said: "We have achieved, one, the
resurgence of onshore and offshore drilling.
We have put the cart, Mr President, before
the horse. Two, we have arrested the decline
in our natural gas reserves. The Ryder Scott
audit for 2012 recorded the smallest decline
in natural gas reserves in almost seven years.
Our reserves are not standing still instead
"There has been the discovery of one tril-
lion cubic feet of natural gas by BP in its
Savonette 4 well.
"There has been, as I said, the acquisition
of 39 per cent of Phoenix Park Gas Proces-
sors Ltd. We have had a highly successful
deep water bid round.
"We have launched two more bid rounds:
one for land and one for deep water.
"The Galeota Port, a significant piece of
national energy infrastructure, is now 80
per cent completed. It will be completed
by the end of 2013. The PNM could not
have gotten that project off the ground.
"We have signed an agreement with
Venezuela for the Loran-Manatee field devel-
"We have signed a project development
agreement with Mitsubishi of Japan, and
Neal and Massy, for US$850 million
methanol to dimethyl ether plant, and we
have signed six production sharing contracts
for deep water worth US$1.4 billion.
"And we have commenced production
from the Jubilee field, regardless of what
the Opposition says.
"I am not fazed by the criticisms and
attacks of the PNM s men of the past. As
I said, men of the past always oppose the
future. I have been attacked on this on the
Loran-Manatee issue. For the record, I did
the right thing and we have advanced the
process for cross-border field development
in T&T very significantly.
"I want to put on record my praise for
all the members of staff of the Ministry of
Energy and Energy Affairs, some of the
young people are here today. Some of the
young people from the Ministry are here
today, from our legal department, from our
commercial department, from our ERPD,
our permanent secretary is here today. I
want to put on record my gratitude for their
support over the last two years. And the
only reward for success is, of course, more
Statoil s announcement this week of a major oil find off Cana-
da s Atlantic coast offers a refreshing reminder that new tech-
nology and high prices are helping uncover new oil supplies far
beyond US shale and the Alberta oil sands.
Statoil says its discovery in the deep-sea Bay du Nord may
contain up to 600 million barrels of recoverable oil, making it
the third-largest find in Atlantic Canada and rejuvenating hope
for an offshore region that was forecast to be in decline for the
next several decades.
Situated in an area known as the Flemish Pass basin, 500
kilometres (300 miles) off the coast of Newfoundland and
Labrador, the discovery opens up a new frontier, one that oil
majors Chevron and Royal Dutch Shell are also poised to probe.
"For that region it s certainly a significant find. Opening up
a new area really lays the path down for growth in other parts
of Newfoundland," said Hugh Hopewell, senior analyst at Wood
While traditional drilling ventures have been overshadowed
in recent years by the North American shale revolution and the
booming Alberta oil sands, new frontiers like the Flemish Pass
are adding to a growing consensus that the world is still flush
with oil, even in areas long thought to be past their peak.
Statoil s nearby Mizzen find may contain up to 200 million
barrels, and the Harpoon discovery, announced in January, is
yet to be evaluated. The finds are modest compared to the
multiple billions of barrels of oil now accessible thanks to hor-
izontal drilling, hydraulic fracturing and oil sands development,
but break the prevailing trend.
Canada s existing three offshore fields---clustered in the Jeanne
d Arc basin some 150 kilometres to the southwest of the Flemish
Pass basin---pumped just under 200,000 barrels per day in
2012, down from around 370,000 bpd at their peak in 2007.
"When a discovery of this size is established, it s most likely
there will be others. Players in the industry who had the region
on a back burner will start looking at it more seriously now,"
said Fadel Gheit, oil analyst at Oppenheimer and Company.
In its latest forecast the Canadian Association of Petroleum
Producers (CAPP) had expected eastern Canadian production
to fall to 90,000 bpd by 2030, after reaching 250,000 bpd in
In the short-term, output will be aided by the 2017 start-
up of ExxonMobil Corp s Hebron field.
Just how much oil is in the region will not be clear for years.
Statoil said it may not be able to return to the region to drill
more wells until 2015 because of rig availability; as rival drillers
move in, it will be harder to get hold of the labour and winterized
rigs essential to operate in the North Atlantic.
"A discovery like this, which is the biggest in the world since
2010, will raise some attention. We are a little bit ahead of the
game but expect increased competition," said Geir Richardson,
vice president of Statoil Canada Exploration.
The state-owned Norwegian company is developing the field
in a joint venture with Canadian partner Husky Energy Inc,
which owns 35 per cent of the field.
US oil based Chevron is already drilling its third exploration
well in the Orphan basin, roughly 50 kilometres northeast of
the Flemish Pass, although a company spokesman said Chevron
plans to keep the results confidential.
Royal Dutch Shell, meanwhile, spent has Can$970 (US$940)
million acquiring exploration rights on four parcels of land off
the southwest shore of the province of Nova Scotia.
The company shot three-dimensional azimuth seismic in the
area over the summer, the first time such technology had been
used in Canada, a Shell spokesman said.
Newfoundland and Labrador s Department of Natural
Resources said geoscience data indicates a further six billion
barrels of potential oil reserves remain undiscovered, in addition
to the 3 billion barrels already found in the province s waters,
while the government of Nova Scotia said it has eight billion
barrels of oil potential offshore. Typically oil fields are only able
to pump a third or less of total reserves.
While that may appear paltry to Alberta s vast oil sands,
where output is expected to hit 5.2 million barrels a day by
2030, it also offers some advantages: Offshore production neatly
sidesteps the issue of congested pipelines in landlocked Alberta
that have driven down the price of oil sands crude, and provides
easy access to markets in Europe and India.
"It s an escape hatch for companies producing in Canada,"
Gheit added. (Reuters)
In Canada's north Atlantic, new oil frontier shows life beyond shale
in GTL, GOP
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