Home' Trinidad and Tobago Guardian : November 21st 2013 Contents The natural gas in the Loran/Manatee cross-
border fields should be brought to Trinidad
and processed into LNG, said Atlantic s chief
executive officer Nigel Darlow. In an interview
with the Business Guardian, Darlow admitted
there were other considerations, but felt the
Loran Manatee discoveries have enough gas to support a Train
V and it made sense to bring it to Trinidad.
He said, "For me, the quickest commercialisation of Loran
Manatee will be in Trinidad using existing infrastructure, but
I know there is lot more to it than that."
He added, "Loran Manatee is reported to contain over ten
tcf that would be enough for two LNG trains for 20 years, so
there is some gas there which you can potentially build Train
V off the back of. But, of course, I appreciate the political
sensitivities and there is no agreement on how or where that
gas gets developed."
T&T and Venezuela have been in talks for almost a decade
on seeking to unitise the fields and then develop the major
reserves. The government in Caracas has said it wants its gas
to go to Venezuela with T&T suggesting the most commercial
arrangement will be to have the gas processed here where
there is already significant infrastructure.
Darlow said even if the Loran Manatee discoveries were not
developed in T&T, there was still potential for a Train V to
be constructed. The issue involves ensuring there is sufficient
gas to support the project.
"Yes, if we can find the gas."
Asked to respond to the question of whether a Train V
should be constructed, Darlow said, "If you are talking about
Train V, it will be dependent on a significant gas reserve. I
think what you are seeing in Trinidad generally is more explo-
ration and appraisal activity and I am confident that T&To
has a proven hydrocarbon basin. I look at it quite simply: the
more wells you sink in the ground, ultimately, the more gas
you will find."
Asked if he was confident that Atlantic Train 1 gas contract
of 400mmcf/d will be renewed in 2018, bearing in mind,
recent gas shortages, Darlow was confident that Train 1 con-
tinued to be a viable prospect.
"I don t have any doubt about the long-term viability of
Train 1. We will get new gas supply contract in place in 2018,
no doubt about that; the terms, we are five year out. We are
not begun to discuss terms for that gas supply contract, so
it s premature." Darlow told the Business Guardian.
Atlantic s CEO said the company was not seeking to remove
any further bottlenecks in an effort to produce even more
LNG. He said most of the easy debottlenecking opportunities
had already been taken advantage of by Atlantic.
Darlow explained, "We are not looking at a significant debot-
tlenecking project right now. It may have been discussed in
the past, but we are not looking at a significant debottlenecking
project. There are one or two projects which may the capacity
to some degree and may improve our LNG yield, but the
majority of the projects are focused on integrity and reliabil-
He added, "It is not obvious most of the debottlenecking
opportunities have been recognised in some shape or form
over the years, so there is no low hanging fruit, otherwise we
would have done that."
Darlow said Atlantic had a very significant capital investment
programme over the next five years and it represents a big
investment by the shareholders in the long-term future of
He was unwilling to reveal the size of the investment, but
said, "The projects are actually aimed at maintaining and
improving our strong production reliability against an aging
plant you have to invest to make sure you maintain and improve
your reliability, which is what we are doing, which is what we
are seeing, but also having a look at the integrity because as
the plant is getting older, you are going to have to spend more
money investing in it, which is what we are doing. So really
to focus on integrity to ensure we remain running the plant
at a high standard."
Atlantic has the most diversified market among LNG traders
selling to 21 countries. Almost half of its exports out of Point
Fortin is now being shipped to South America where the prices
are rivalling those seen in Asia/Pacific region.
Argentina is now the largest buyer of LNG from T&T, with
Chile and Brazil making up the South American market.
Darlow said low LNG prices in the United States led Atlantic
to significantly reduce the amount of the commodity sold to
the US and instead export it to South America.
"As of the end of September this year, 45 per cent has gone
to South America and 18 per cent to the US market so you
have seen a big change over the last five years. If you had
asked me that question five years ago probably 80 per cent
would have gone to the US market. So there is a huge turnaround
in terms of where Atlantic s LNG is going at the moment and
that is in response to pricing," Darlow said.
Darlow said there was a major differential in the LNG prices
in North and South America with North America s spot prices
at less than US$4 per million British thermal units (mmbtu)
while South America has spot prices averaging US$15 per
Darlow said the advent of shale gas in the United States
does not pose a risk to Atlantic because the global demand
for LNG continues to be robust well into the immediate future.
NOVEMBER 2013 • WEEK THREE www.guardian.co.tt BUSINESS GUARDIAN
ENERGY | BG9
BRASILIA/BEIJING: Brazil s state-
run oil company Petrobras has struck
a deal to sell its Peruvian oil and gas
assets to PetroChina, China s top oil
and gas firm, and its parent China
National Petroleum Corp for US$2.6
Petrobras, which has been looking
to sell its foreign assets to focus on
tapping massive deposits discovered
off Brazil s Atlantic coast, said the deal
signed on Wednesday still needs the
approval of the Chinese and Peruvian
The Chinese companies agreed to
buy all the shares of Petrobras Energia
Peru SA, which has three oil and gas
fields in Peru. The fields currently
produce about 800,000 metric tons
oil equivalent a year, PetroChina said
in a securities filing.
"The three target blocks are all qual-
ity oil properties in Peru with achiev-
able profit potential," PetroChina
added. "The acquisition of the assets
will help to expand the scale of
PetroChina s oil and gas cooperation
in Latin America, and drive the sus-
tainable development of PetroChina s
Petrobras said the agreement
involves Lot X, a mature field that has
been in production since 1912 and
produced 16,000 barrels of oil equiv-
alent last year, and Lot 58, where gas
was recently discovered.
The deal also includes a 46.16 per
cent stake in Lot 57, a natural and
condensed gas field that has not begun
operating yet. The Peruvian exploration
subsidiary of Spain s Repsol owns the
remaining 53.84 per cent of this bloc.
Petrobras said the sale is part of its
2013-2017 business plan announced
in March that aims at divesting US$9.9
billion in assets, including stakes in
Gulf of Mexico blocs and exploration
assets in Africa.
The Peru assets are being sold to
CNPC Holdings and CNODC Inter-
national, both overseas units of CNPC
Exploration and Development Com-
pany Ltd, which is a subsidiary of
PetroChina and indirectly of CNPC,
the controlling shareholder of
The deal reinforces the growing
presence of Chinese oil companies in
Last month, CNPC and China s
CNOOC Ltd each got ten per cent
stakes in Brazil s largest offshore oilfield,
Libra, through a consortium led by
Petrobras that includes France s Total
SA and Anglo-Dutch Royal Dutch Shell
Plc.The Libra field is estimated to hold
between eight billion and 12 billion
barrels of recoverable oil discovered
beneath a layer of salt thousands of
meters below water and sub-sea rock.
Bring Loran Manatee's
gas to Trinidad Energy Reporter
Petrobras sells Peru unit to
PetroChina/CNPC for US$2.6bn
Nigel Darlow, Atlantic LNG chief executive officer
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