Home' Trinidad and Tobago Guardian : June 5th 2014 Contents T&T is not the only energy-rich
country in the Caribbean,
Caribbean Development Bank
(CDB) president Dr Warren
Smith said last week while
addressing delegates at the
bank s 44th annual meeting in Georgetown,
"We now know that our other borrowing
member countries are definitely not energy
poor. Guyana alone has enough renewable
energy potential, mainly in the form of hydro-
power, to meet all of its electricity requirements
for the foreseeable future; supply all of the
needs of immediate neighbours, Grenada and
T&T; and still have enough left over to sell to
neighbouring Brazil. The situation is similar
for Suriname," he said.
In addition, Dominica, Grenada, Montserrat,
St Kitts and Nevis, St Lucia, and St Vincent
and the Grenadines have great potential to
generate their entire base-load electricity
requirements from geothermal sources, he
While their domestic markets are quite
small, technological advances in the develop-
ment of undersea transmission cables would
allow these countries to exploit their relatively
large geothermal reserves for export to neigh-
bouring countries, Smith told the meeting.
The 44th Annual Meeting of the of the
Board of Governors of the CDB officially
opened in Georgetown with Smith "making
a strong appeal for regional countries to give
urgent and priority attention to the role of
energy in improving economic performance,"
a CDB statement said.
Addressing colleagues, governors and del-
egates from CDB member countries at the
Guyana International Conference Centre, Smith
spoke on the theme, "Unlocking Opportunities
for Competitiveness and Growth---The role of
There must be a frontal attack on energy
costs and the generally poor state of the region s
electricity infrastructure if the Caribbean s
competitiveness landscape is to be addressed,
Smith noted that Guyana, which host this
year s meeting, shared borders on the South
American continent with Venezuela and Suri-
name, which are CDB countries, and Brazil
which is expected to join shortly. The continent
now has some of the world s fastest growing
economies. Smith pointed out that in recent
times, Guyana was achieving consistently high
growth rates and improvement in many of its
key economic indicators.
CDB suggests Guyana as gateway to
He suggested that as the CDB s borrowing
member countries move to strengthen trade
with South America, Guyana occupies a strate-
gic position as a gateway to the continent, the
The CDB president said if the aspirations
of Caribbean people to end poverty in the
region, to provide high quality jobs for young
people, and to have a just and prosperous
Caribbean are to be fulfilled, then industries
must be equipped and facilitated to compete
in South and North America.
"They must be equally prepared to take
advantage of the opportunities being offered
through the European Economic Partnership
Agreement; the hopefully imminent
Caribbean-Canada Trade Agreement; and the
burgeoning markets of the middle and far east-
ern countries," he said.
This year s annual meeting of the CDB gov-
ernors therefore represented an ideal setting
to look at the nexus between competitiveness
on the one hand, economic growth on the
other, and the role that energy can play, he
Smith proposed three areas of specific focus
that had to be addressed in the current eco-
"First, Caribbean countries have a compet-
itiveness problem; and it is at the root of our
difficulty in achieving the high rates of eco-
nomic growth, which we need to be able to
provide the standard of living to which our
people aspire," he said.
"Second, the high price of electricity is a
major source of our region s uncompetitiveness,
and of our vulnerability to external shocks.
Third, we can increase our energy independ-
ence substantially; reduce the cost of energy;
and in the process, create a whole new industry
based on a new paradigm," he added.
The CDB president said high rates of eco-
nomic growth have eluded the majority of the
CDB s borrowing member countries for a long
"Our region s economic expansion of two
per cent per annum over the past decade has
been consistently below the global rate of 3.8
per cent; lower than the four per cent average
for other Small Islands Developing States
(SIDS); and way below the average of six per
cent for emerging and developing countries,"
Citing two surveys---The World Bank s
"Doing Business" Survey and the World Eco-
nomic Forum s Global Competitiveness Index---
Smith said the Caribbean s ranking did not
compare well with other countries in the area
of competitiveness. For example, out of 189
countries surveyed for the Doing Business
index, the average ranking for the Caribbean
The rankings, he said, confirm that the
CDB s borrowing member countries will have
difficulty maintaining existing markets and
penetrating new ones unless there is radical
transformation in the way they do business.
The two surveys highlighted areas that need
to be addressed including inadequate trans-
portation, telecommunication and logistics
infrastructure; insufficient access to affordable
credit; bureaucratic red-tape; low productivity;
and high energy costs.
Smith said the macro-economic impact of
the high cost of imported fuel and the con-
sequential high electricity price were reflected
in deteriorating performance indicators in most
borrowing member countries.
"High levels of debt to GDP and depletion
of foreign reserves are directly related to this
dependence on imported oil. High electricity
prices erode the competitiveness of the regional
economies and, therefore, their ability to earn
the required foreign exchange to pay for
imports, including oil," Smith added.
Regional countries must therefore reduce
their dependency on imported fossil fuels, the
Smith said: "Unless we can substantially
reduce energy costs, we will not succeed in
improving our competitiveness and reducing
our vulnerability to external shocks."
BUSINESS GUARDIAN www.guardian.co.tt JUNE 2014 • WEEK ONE
T&T not the only energy-rich
country in the Caribbean
Leni Gas & Oil plc (LGO) on Monday announced
that well GY-664 has been successfully brought
on production at a stabilised free flowing, post-
clean up, rate of 240 barrels of 37 API oil per
API is the acronym for the American Petroleum Institute
which has an inverted scale for denoting the lightness or heav-
iness of crude oils and other liquid hydrocarbons. Calibrated
in API degrees (or degrees API), it is used universally to express
a crude s relative density. The lighter the crude, the higher is
its market value. Oil with API greater than 30 is termed light;
between 22 and 30, medium; below 22, heavy; and below ten,
extra heavy. Brent crude on average has an API gravity of 35.5.
Brent crude was last trading in London Monday for approx-
imately US$110 per barrel.
Leni s stock gained a whopping 34.68 per cent on the news
Monday, hitting a two-year high of 2.18 pence after trading
only two months ago for a fraction of a pence, sliding as low
as 0.66 pence on March 31.
At this production rate of 240 barrels of oil per day (bopd),
Goudron now becomes Leni s highest producing field. LGO
has existing production from its Spanish oilfield, around 100
bopd but the company has said, and reiterated in a statement,
that its focus for new production is entirely on Trinidad. Leni
has been trying to sell the Spanish assets, without any success,
so it is now looking to farm out the Spanish field and is
currently in discussions with an interested partner according
to a shareholder s e-mail.
The first of its 30 planned wells, GY-664 "is flowing under
its own pressure through a 7/32-inch choke at a wellhead
pressure of 660 psi, without any water or sand production,"
LGO said in a statement to the London Stock Exchange on
The second development well, GY-665, which has an antic-
ipated total depth of 3,500 feet, is now at the intermediate
casing point at 1,606 feet and has intersected approximately
310 feet of gross oil sand in the Goudron sandstones.
LGO chief executive officer Neil Ritson said in a written
statement: "This is a very significant outcome and I am sure
it will be completely transformational for the field and the
company. As the first new production well on the field for over
30 years, GY-664 was drilled with an on-balance mud system
and completed with modern tubing conveyed guns. The initial
flow rate demonstrates the value of this approach; exceeding
the historic averages four-fold. We fully expect many more
similar results as the drilling campaign progresses and, indeed,
well GY-665 is already showing considerable potential."
Giving details on how it brought GY-664 into production,
LGO said a 278-foot section of the Gros Morne sandstone
member of the Moruga Formation was perforated using tubing
conveyed (TCP) guns between 2,177 and 3,205 feet. The TCP
guns were fired at 8:25 am (T&T local time) on Friday, May
30. The well was completed with 2 7/8-inch production tubing
and after perforation, it initially flowed naturally at a rate of
up to 326 bopd through a restricted choke and has now been
stabilised at a rate of 240 bopd after running a number of flow
tests at various choke settings.
Production at this rate has been stable for the last 36 hours
with wellhead pressures remaining constant at between 660-
700 psi, LGO said.
No attempt has been made to open the choke to allow unre-
stricted flow, the statement said. The flow rate is being delib-
erately restricted in order to maximise the long-term production
potential from the well and to avoid any potential damage to
the reservoir or the acceleration of water production, LGO
Initial pre-drill flow rate assumptions were of at least 60
bopd based on historic data from the field, however, the
improved drilling and perforating practices used have greatly
assisted in reducing formation damage and improving oil
inflow characteristics, the company said.
Well GY-665, the second of the 30 new development wells,
is in the process of being logged before setting casing at the
base of the Goudron sands at a depth of 1,606 feet. The well
has encountered the anticipated oil bearing Goudron sandstones
with approximately a minimum of 310 feet of gross oil pay
based on the mud logging. After casing has been set, the well
will be drilled to the primary target in the Gros Morne sand-
stones, the statement said.
Well GY-665 is approximately 800 feet south-west of the
GY-664 and is the first of four planned wells from the same
drill pad. GY-665 has a planned total depth of 3,500 feet and
is anticipated to intersect with all three prospective reservoir
intervals; the Goudron, Gros Morne and Lower Cruse, and is
expected to encounter the Lower Cruse at around 3,000 feet.
Leni's first Goudron well now producing
Our region's economic
expansion of two per cent
per annum over the past
decade has been consistently
below the global rate
of 3.8 per cent
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