STEAM

(SCIENCE, TECHNOLOGY, ENGINEERING, AGRICULTURE AND MATHEMATICS)

Trinidad & Tobago Energy Conference 2019
Claire Fitzpatrick, Regional President, BP Trinidad and Tobago

Claire Fitzpatrick, Regional President, BP Trinidad and Tobago (BPTT) addressed participants at the opening day of the Trinidad and Tobago Energy Conference 2019. She noted that there are major transformations taking place in energy markets across the world. These transformations are being driven by the “dual challenge”, that is; the world will continue to need more energy but from lower carbon sources. Technology is driving a lot of this change and as the global industry evolves, so must our local energy industry.

Fitzpatrick explored the critical role technology plays in disovering and recovering more energy resources safely and efficiently as well as the skillsets the workforce will need in the changing energy environment. Additionally, she explained that as technology continues to disrupt the status quo, industry and government must be courageous and adopt a more collaborative approach to improve the competitive landscape.

“We need to work together, challenge the status quo to bring new solutions to the table,” Fitzpatrick said.

In 2018 BPTT announced an area development plan which includes the possibility for $8B investment dollars and 9 projects over the next 10 years. Fitzpatrick explained that if BPTT is to deliver the projects, technological innovation, deeper collaboration and the courage to move beyond the status quo of traditional ways of doing business will be required to make the plan a reality.

She also weaved the collaboration theme into how BPTT could work with the supply chain. By providing examples of partnerships in other areas of the world and suggested with the right frameworks similar partnerships could work in Trinidad.

“Across BP, we are successfully partnering with our supplier to solve problems together because we recognize the answers cannot be found in one sector of the industry, or indeed just our industry, and that we go further when we go together.”

BP’s blue-eyed girl, Claire was appointed Regional President BP Trinidad and Tobago in February 2018. She became Managing Director for BP’s Exploration and Production interests in Australia in September 2014.

In this role, she was accountable for all BP Upstream activity in Australia, including the North-West Shelf Venture. Claire served as a Director of the Board of North West Shelf Gas Pty Ltd, the gas marketing agency for the venture. In addition, she was a Board Director of the Australian Petroleum Production and Exploration Association (APPEA) and Chairperson of the APPEA Executive
Committee.

Claire joined BP in 2002 as Chief Accountant/Head of Accounting Policy for Upstream. Following this, she was Head of Performance Management for Upstream and in 2007 moved to BP Alaska, initially as Commercial Director then as the Chief Financial Officer. In 2012 Claire was appointed Head of the Executive Office for Upstream in BP’s London office.

Prior to BP, Claire worked for Ernst & Young in London and Houston across a variety of service lines focused on the oil and gas sector. Claire has a BSc in Biological Sciences and is a Fellow of the Institute of Chartered Accountants of England and Wales

Eugene Tiah, Chairman of the Energy Chamber of Trinidad and Tobago

All sectors of the global economy are being transformed by rapid developments in artificial intelligence, robotics, advanced data analytics and other advances in technology. The energy sector is no exception, and we have therefore taken as our theme for the 2019 edition of this long-running conference “technology: transforming the industry”. Over the next two days we will have a packed conference agenda exploring this topic, as well as providing an overview of the energy sector in Trinidad & Tobago and the wider region.

The past few years have been challenging for the oil and gas industry globally, and specifically in Trinidad & Tobago. While 2018 saw better average oil prices than 2017, significant declines at the end of the year and into early 2019 have shaken confidence in a longer-term improvement in prices. In response to weaker prices and projections of long-term downward pressure on oil prices, due in part to increasingly competitive renewable energy sources, oil and gas companies have continued their relentless drive for efficiency and competitive pricing from service companies and contractors.

This in turn has meant that service companies and contractors, who make up the majority of the Energy Chamber’s membership, have had to make serious and fundamental adjustments to the way in which they do business, just to be able to survive. The adoption of new technology has an important role to play in making this transition.

We need to have the right regulatory and policy environment to help our local service industry navigate these tricky waters. Serious reforms to the industrial relations environment and the education system are crucial if we are to successfully make this transition. The right local content policies can also assist the local service industry and ensure that we are able to retain more value in-country, at the same time as attracting direct foreign investment into the economy. Again, the right policies around education, capacity building and skills development will be crucial. The local service industry will also need the support of the financial services sector to make the necessary investments, and fostering those linkages is an important activity for the Energy Chamber.

In addition to the global factors impacting the industry, there have been specific issues facing the industry in Trinidad & Tobago. The hard choice to close the loss-making state-owned oil refinery was clearly the major decision in the Trinidad & Tobago energy sector in 2018. Many members of the Energy Chamber have traditionally done a significant volume of business with the refinery; for those members, the refinery accounted for on average twenty-five percent of their sales. Adjusting to this new reality has involved our members making some serious choices about how they have to run their businesses.

While the future of the refinery remains uncertain, I am sure that everybody hopes that we will find a suitable private-sector entity willing to take on the challenge, as has already happened with the gas to liquids plant.

What is of undoubted importance to Trinidad & Tobago is making a success of the new upstream focused Heritage Petroleum. Technology is going to have a very important role to play in profitably unlocking the significant oil reserves that still exist in Trinidad & Tobago, but without the right institutional structures and policy environment it is going to be difficult to attract the necessary private capital that will be crucial to the success of Heritage and the oil sector more widely. One of the key inhibiting factors is the current structure of supplemental petroleum taxation, which severely inhibits competitiveness of the Trinidad oil sector. The Energy Chamber once again renews its public plea that the Government seriously addresses this issue.

The other major issue that has specifically impacted on the local energy sector has been the continued shortfalls in gas production, which has had serious implications for the petrochemical sector and LNG exports. The good news here is that we have seen continued significant investment in the upstream gas sector and continued improvements in gas supply, with further increases projected over the next few years. Negotiations between BP and Shell, the major upstream suppliers to the Atlantic LNG facility, have been reported to have progressed well, allowing new investment decisions to be taken. We have also seen contracts being successfully renegotiated with NGC for domestic supply and in late 2018, first gas from a new T&T focused gas producer, De Novo.

Despite the new investments taking place, shortfalls in supply have continued to seriously affect the local petrochemical sector, which has had to also contend with higher gas pricing and increased competition in its key export market of the USA. The continued survival of the flagship Trinidad petrochemical sector, of which we are also so rightly proud, will rely upon a relentless focus on efficiency and competitiveness and we have to be extremely careful of any measures that will increase costs in this sector.

One of the areas that the Energy Chamber has done a lot of work in within the past year is the area of energy efficiency. This is an area in which there are significant benefits that can be created for the local economy, and there are some low hanging fruit that we can easily pick, to make more gas available to Point Lisas. Renewable energy also has an important role to play in reducing the demand for gas for electricity generation and investments in both efficiency and renewables can have a tremendous positive impact on our economy and the availability of foreign exchange.

It is also important for us to be involved in renewables and efficiency so that we can begin to understand the technologies involved, and build capacity and knowledge in these key areas for future growth within the overall energy sector. We know that technology around electric engines and autonomous vehicles is going to have a huge impact on the energy sector and we need to be involved in those technologies today.

While we focus on those new opportunities in renewables and efficiency, it is also important that we do not lose sight of the opportunities on our doorstep with new hydrocarbon developments. We are seeing a very encouraging deepwater exploration campaign underway in Trinidad, led by BHP, but nothing quite matching the enormous success of Exxon in neighbouring Guyana. Trinidad has the potential to develop a much more robust energy services sector, including developing deepwater expertise, by playing the role as a hub for the regional energy services industry, providing expertise and capacity to French Guiana, Suriname, Guyana, Barbados, Grenada and potentially offshore Venezuela. This should be a focus of national development and an important element in an overall export diversification thrust.

We have an interesting workshop on Wednesday afternoon looking at the development of a regional deepwater-focused services sector and the technology that drives that sub-sector.

In conclusion, these are interesting and challenging times for the energy sector. Technology is rapidly changing how we all work and creating both interesting opportunities and serious threats to our companies and the wider economy. We in the Energy Chamber hope that the deliberations over the next three days will help you chart a successful course.”

Feature Address –  Prime Minister of Trinidad and Tobago

“Once again, it is my distinct honour and pleasure to deliver the feature address at this the opening of 2019 Energy Conference and Trade Show hosted by the Energy Chamber of Trinidad and Tobago. I want to thank the organizers for the sterling effort dedicated towards organizing this very important event and for being so kind to invite me to address you. It is an opportune moment, coming soon after my nationwide broadcasts and public conversations with the nation, on the state of affairs of the economy of Trinidad and Tobago (T&T) and particularly, the contribution of the energy sector.

The energy sector of T&T, notwithstanding its performance in the recent past, represents the industry best placed to achieve significant economic growth, not only within the sector but for the nation as a whole. However, as a small producer, Trinidad and Tobago’s energy sector is inextricably tied to the oscillating fortunes of the global oil and gas industry.

In its 2019 projections, the World Bank Group Global projected the slowdown in global economic growth to slow to 2.9 percent. This is set to have a negative impact on the global economy, including the oil and gas industry and by extension T&T’s energy sector. There appears to be no respite in the volatility of energy prices. With a projected oversupply in oil production, prices are likely to be subdued unless there is a significant cutback in production by the major producers. In the meantime, however, Henry Hub natural gas prices have remained at the 2018 levels.

Notwithstanding, the volatility of energy prices, by and large, the oil and gas industry has remained resilient. The major companies practicing in the industry, in the face of lower prices, increased cost pressures, and tighter environmental standards, have been adopting powerful new technologies to ensure future relevance.

It has been well established that the petroleum industry has been in the forefront of changes in state-of-the-art exploration and development and production technology. Technological advances such as three-dimensional seismic techniques, polycrystalline diamond compact drill bits, horizontal drilling, and offshore platforms capable of operating in hostile, deep-water environments are widely acknowledged to have had significant impact on productivity in exploration and development.

In the context of the local oil and gas industry, the introduction of technology has been instrumental in its quantum leap as an industrial force in T&T. In an earlier time this country had the distinction of being the first producing country in which gas re-cycling and re-reinjection was applied in order to recover more oil. This was in the year 1916 in the Tabaquite Field. However, all was not plain sailing as in the early years drilling was dangerous business and blow-outs were the order of the day. A solution was required. It took the form of a new development – drilling fluids- imported from the US in the 1930s to resolve the problem. Its introduction revolutionized the industry and allowed for much deeper wells to be drilled.

However, there were other challenges and the early operators realized as many do today, that T&T geological formations are exceedingly complex. This necessitated lengthy and costly coring operations to acquire the information required to delineate the lenticular reservoirs. It required a new technology- Electrical Logging-which helped to resolve formation complexity and eliminate the need to take expensive cores. During this period, the logging suite was increased by the introduction of the Sidewall Coring Tool which provided depth–accurate core samples. These technologies and other inventions enabled the industry to survive and flourish at a time when there was a global economic depression.

By the 1950s, the industry moved offshore and encountered a new level of technical and logistical challenges. However, the impending electronic age and the advent of computers brought about a positive change in oilfield technology and facilitated this new development.

The introduction of computers made possible the rapid processing of large amounts of data, transmission of data from remote locations to central offices and an enhanced ability to interpret data (for example, with computer graphics). Computerization occurred primarily in the areas of seismology and reservoir rock and fluid systems evaluation and, to a lesser extent, in drilling. The first computer-related application in seismology was the interpretation of exploration gravity measurements using mainframe computer systems.

During this period a suite of computer based applications such as exploration gravity measurement computer interpretation, reservoir and rock system and seismology digital processing were introduced. In drilling technology, the most significant advancement at that time was precise well placement within the highest quality portions of the reservoir. This allowed operators to drill fewer but better wells at lower cost.

In drilling, computerization also provided another dimension as it allowed the integration of many variables such as bit speed, weight on the bit and angle to optimize different aspects of drilling operations. This technology resulted in significant improvements in productivity associated with more efficient use of equipment (that is, less need to replace bits and broken drill strings) and avoided downtime during drilling operations. The creation of computerized drilling databases also allowed operators to use historical experience to improve their operations in similar geographic areas and geologic formations.

Improvements in drilling technology occurred with regularity and encompassed several specific categories of technology, including-downhole motors, well pressure control, drilling techniques, drilling rigs, deep drilling feasibility and tubular goods. Notable advances included the development of more durable bit bearings and tungsten carbide inserts for rock bits, as well as the polycrystalline diamond compact drill bits, automated rigs and rig power systems. These developments had significant effects on productivity in the domestic oil and gas industry largely because they extended the life of equipment and reduced the time spent replacing damaged or worn-out equipment. Overall, they contributed to the lowering of costs, which was important to myriad of operators seeking to establish themselves in the industry at that time.

These improvements in technology fueled the next phase of oil and gas exploration which took off in the marine areas. The first offshore well was drilled in 1954, in the Soldado Field by Trinidad Northern Area. This was followed by the first well which started on a platform 1.2 miles offshore from Brighton in 1958. The structure was designed to accommodate thirty-six (36) wells, a world record for that platform then. The next exploration well was the Galeota No. 1 on the East Coast which was un-economic. It was followed by the first commercial discovery on the East Coast, well QPR off Point Radix. The effect of the extended exploration to the marine area resulted in oil production increasing from 21 million barrels in 1952 to 67 million barrels by 1967.

The next decade saw improvements in the techniques for identifying hydrocarbons and accurate assessment of reserves, when a discovery is made. This was abetted by advances in the application of microcomputers and interactive mainframe and terminal systems.

Current advances in technology that have impacted positively on T&T include conventional 3-D seismic – a technique that reveals more about subsurface geology and potential hydrocarbon reservoirs. This technology continues to evolve with the development of the ocean bottom cable system and ocean bottom nodes for the acquisition of seismic data. These improved technologies are currently widely used in the domestic oil and gas industry with great success. Their application has been instrumental in identifying many of the recent discoveries and the upward revision of reserves in existing fields. This application led to the situation in 2017, where the replacement of natural gas reserves exceeded production of natural gas in that year. The last occasion this happened was 2004.

In Trinidad and Tobago gas production is on the rise, increasing from 3.2 billion cubic feet per day in 2017, to 3.6 billion cubic feet in 2018 and is expected to increase to 3.9 billion cubic feet per day in 2019 as new production is brought on stream. We expect gas production to stabilize over the period 2020 to 2023 at approximately 4.0 billion cubic feet per day based on the level of investment to be undertaken by upstream companies and any cross-border initiatives with Venezuela.

In our country, gas curtailment has been contained due to the increase in gas supply, which in part is due to the stability brought to the upstream sector by the settlement of domestic gas contracts, in 2017, by NGC with EOG Resources and BPTT. The National Gas Company (NGC) is currently in negotiations with Shell for a new domestic contract. A Term Sheet has been executed by the parties and a Gas Sales Contract is being worked on. The downstream industry can therefore expect a greater reliability of gas supply in the near term.

The current gas supply, however, does not include any contribution from our deep-water blocks at this time.

Initially, as in the case of T&T, exploration was confined to land and later shallow or moderately deep-water. As resources in these areas became depleted the global industry began to move further offshore and into deeper water. However, as the industry moved further offshore it has had to adapt to the new and often hostile environment in the exploring for and developing of petroleum resources. These adaptations included, improvements in fixed and non-fixed offshore structures and floating drilling systems such as semi-submersibles. The limitations of fixed structures were soon recognized. This led to the development, for deep water drilling, of compliant structures such as, tension leg platforms, buoyant towers and articulated columns, that allow for flexibility while remaining anchored to the bottom of the ocean floor.

These innovations enabled operations in much deeper water. Improvements in floating offshore drilling technology have also taken the form of greater depth capability. These were aided by the development of more effective and accurate station-keeping such as dynamic positioning systems, mooring systems and anti-roll devices for semi-submersibles and drill-ships. Improved techniques and equipment were also developed for working underwater and at increasing depths, particularly in carrying out repairs on wellheads or platform components.

The development of technology to facilitate the exploration and developing of hydrocarbon resources in deep-water has redounded to the benefit of the countries in the Caribbean Region.

The structure of the Caribbean region testifies to the extremely unstable condition of the terrestrial crust of this intercontinental and simultaneously inter-oceanic area. In the recent geological epoch, the Caribbean region is represented by a series of structural elements, the main of which are the Venezuelan and Colombian deep-sea sub-oceanic depressions, the Nicaraguan Rise, and the Greater and Lesser Antilles bordering the Caribbean Sea in the North and East.

In a 2012 report, the US Geological Survey of thirty-one (31) priority geological provinces in South America and the Caribbean assessed the un-discovered conventional hydrocarbon potential at 126 billion barrels of crude oil and 679 trillion cubic feet of natural gas. In the Guyana-Suriname Province the crude oil potential was assessed at 13.6 billion barrels and natural gas at 21 trillion cubic feet. The study also assessed the potential of the Tobago Trough which is located north of Block 22 between Tobago and Grenada (the Grenada Trough) and the Barbados Accretionary Prism to the East. The geology suggests upper Miocene and lower Pliocene deltaic sandstones as well as deep-water turbiditic sandstones. Its potential was assessed at 15.7 trillion cubic feet for natural gas and the Barbados Accretionary Prism at 14.5 trillion cubic feet for natural gas and 154 million barrels for crude oil.

The findings of the US Geological Survey have been validated by the hydrocarbon discoveries in Guyana’s deep-water. As a consequence, there has been great interest by major upstream companies in conducting exploration for hydrocarbons in the territorial waters of Barbados, Jamaica, Suriname, Bahamas and Grenada.

T&T with its technical expertise, capacity and experience has offered to assist member CARICOM states in the development of their hydrocarbon resources. In this regard, the Government of the Republic of Trinidad and Tobago (GORTT) has executed Memoranda of Agreement for the provision of technical assistance in the energy sector with both the Government of Guyana and the Government of Grenada. It is my sincerest hope that in the clamour for the elusive “secret information” to which everyone is entitled, that these standard operational procedures, some of which must of necessity carry confidentiality clauses, do not fall victim to the abandonment and withdrawal of enthusiasm on any of these very valuable initiatives. Preliminary discussions have been held with Government of Barbados with the view to the establishment of such agreement. Technical Teams from Trinidad and Tobago and Barbados are to be appointed to develop the necessary Memorandum of Agreement.

This country is well poised to service the industry requirements emanating from the development of emerging hydrocarbon economies in the Caribbean. The existing facilities in the Southwestern Peninsula which includes the Labidco Industrial Estate and port, and the Brighton port, will be supplemented by a maritime business anchored on a dry-docking facility at La Brea. The facilities, upon completion, are anticipated to comprise a large container and bulk transfer terminal for a trans-shipping business and an outfitting terminal for a ship building, dry-docking and repairing business. It will have a deep-water port with a capacity to to handle drill ships, Panamax vessels, rig supply vessels, offshore construction support vessels and other energy services.

Notwithstanding anything else that we might be engaged in, the energy sector remains pivotal in the economic development of Trinidad and Tobago. Gas production has eclipsed oil production and is the dominant hydrocarbon but we will keep on being aggressive in expanding our oil business. In the early years of the domestic industry oil was king and gas was considered as a by-product to be flared. All of that was changed with the development, particularly of the Point Lisas Industrial Estate and the Atlantic LNG Trains. While gas production flourished oil production stagnated and languished. At present oil production is at a low of approximately 66,000 barrels per day, with two-thirds of the production coming from state owned company Heritage Petroleum Company which acquired the petroleum production responsibilities of Petrotrin.

Petrotrin which held most of the country’s oil reserves was mainly responsible for the drastic decline in oil production as much needed capital was diverted to other parts of the business, which in several instances offered little or no financial returns. The Board of Directors of Heritage has projected by year end crude oil production could be restored to pre-2018 levels at approximately 40,000 barrels of oil per day, initially through an extensive workover program involving up to 18 work-over rigs on its land assets. Areas such as Forest Reserve, Catshill, Guayaguayare and Point Fortin will benefit from this increased activity.

Government cognizant of the impact of the restructuring of the former Petrotrin has accelerated and initiated several projects in the West, South and South-West Peninsula which will benefit the communities in these areas. They include The San Fernando to Point Fortin Highway and the rehabilitation of the Moruga Main Road which are already in train and for which construction is being accelerated in this year 2019. Others include the development of the Phoenix Park Industrial Estate, the San Fernando Waterfront re-development and re-generation project, the development of an Administrative Complex at Chancery Lane, San Fernando, the restoration and upgrading of Skinners’ Park and a new fishing port in Moruga. It is estimated that 3,500 direct jobs and 5,700 indirect jobs will be created in the West, South and South West Peninsula.

The transition from Petrotrin to the new business model comprising a Holding Company, Trinidad Petroleum Holding Company Limited and subsidiaries, Heritage Petroleum Company Limited, Paria Fuels Limited, Guaracara Refining Limited and Petrotrin has been orderly, relatively uneventful and the haemorrhaging that characterized the operations of Petrotrin has been arrested.

To date Heritage Petroleum has sold several cargoes of crude oil and has received a price as high WTI plus US$2.00. Paria Fuels has been serving the local transportation with liquid petroleum fuels and continuously holds an inventory of 20 days’ supply of the fuels. LPG is being provided by Phoenix Park Gas Processors with Government continuing to provide substantial subsidy on this product without increase to the citizenry. Bitumen is being supplied by Lake Asphalt Company Limited and the open market.

As for the refinery, an RFP is currently being finalised for issue to the industry. Expressions of interest have been received from about fifty (50) interested parties from all sectors of the industry, including the Oilfield Workers Trade Union. The Union has been given an opportunity to be the first to have access to data for the preparation of its proposal. On finalization of the RFP, a public notice will be issued inviting bids. It is projected that entire process of receiving, evaluating and selection of the successful bidder will be completed by the end of June 2019. This process could see the new holding company making a recommendation to Government by mid-year with this resulting in reopening of refining operations sometime later on, without taxpayer exposure. This all depends entirely on what the interested parties propose to the Government in the months ahead.

Given, the importance of the domestic energy sector, this Administration has focused on creating stability and where necessary reforms within the sector in order to optimize its contribution to the national economy. However, on assumption to office, we realized that there was an imbalance in the financial returns accruing to stakeholders, particularly as it relates to LNG. The upstream companies and their marketing affiliates were enjoying the lion’s share of the revenue accruing from this business and the Government and by extension the people of this country were receiving minimal returns. We highlighted this concern in the Spotlight on Energy which was held at this very venue in March of 2018. This, to our surprise evoked the ire of some local energy commentators who were of the view that we were sending the wrong signals to the upstream companies. Notwithstanding this not so surprising reaction, we persevered.

In April 2018, we met with senior executives of both Shell and BP in London to discuss a more equitable arrangement for the sharing of revenue accruing from LNG. Arising from the discussions we established Empowered Negotiating teams to review the LNG marketing arrangements. We have completed Phase 1 of negotiations with BP and executed a Memorandum of Agreement which provided for the payment of US$73M for royalty gas claimed by the Government and terms for a new ALNG Train 1 marketing arrangement.

Gas for ALNG Train 1 will be sourced from the Cassia Development. The construction of the jacket for the Cassia Platform will be undertaken by TOFCO. The enhanced incremental GORTT revenue under the new LNG marketing arrangements versus a continuation of the current LNG marketing arrangements is estimated at US$118M (TT$800M) per year. Negotiations with both BP and Shell are continuing and are projected to be finalized by the end of first quarter 2019. In this regard, I wish to complement both companies on the professional manner in which negotiations are conducted and look forward to a mutually satisfying outcome.

As we move forward, we would wish to deepen our relationships with the upstream companies many of whom are involved in research and development on their own or indirectly through academic institutions. While T&T has benefited from the application of technology there has not been any serious investment in research and development for the oil and gas industry in this country. In today’s globalized world, a country’s prosperity depends on its ability to generate new ideas and convert knowledge into socio-economic benefits.

Technology enhances these capabilities and provides a platform on which a country can build its economic development. However, T&T has lagged behind in research and development. As a consequence, there has been limited production and export of high technology products. In a 2015 World Bank Report on high technology exports from developing countries T&T occupied the cellar position of the study group with its high technology exports representing 0.1% of total manufacturing exports. Costa Rica attained 16.83% and Singapore achieved the highest with 49.28 %.

Therefore in our 2030 Vision we have identified this as one of the priority areas that needs to be addressed. Accordingly, we will be promoting among our citizenry a culture of innovation, and an increased level of investment in research and development by both public and private sectors.

In this regard, we intend to engage the major oil and gas companies and domestic educational institutions the University of the West Indies and the University of Trinidad and Tobago in effecting a strategy to promote and finance research in technology relative to the oil and gas industry.

We are at critical juncture of our development. The platform on which our economic development has been based has been subject to a volatility that is to be unrelenting and threatens our stability. In the circumstances we need to be a cohesive group working together for our mutual benefit.

The oil and gas industry is a close knit community in T&T. We are operating in a challenging environment and therefore we need to be more collaborative, by sharing risks, establishing joint ventures and adopting technology which allow for increased productivity, real time information dissemination and decision making.

I acknowledge that there has been collaboration but in a too limited number of instances. We need to expand the level of collaboration to maximize the level of hydrocarbon output. Given the changing global energy landscape we cannot afford to have hydrocarbon resources that remain un-exploited due to scheduling issues. The legal and regulatory systems provide for such collaboration. There is no reason why we cannot work together for a better outcome.

Time is of the essence. Let’s have more considered action and less talk. Moving forward, the key challenges for the industry will be to reduce costs, adhere to environmental standards and to continue to discover new methods, while achieving high levels of efficiency. A steep challenge, but achievable.

In closing, I wish to remind you that the oil and gas industry of T&T is inextricably linked to the global industry and so too are our fortunes. It is our goal that it continues as a globally competitive and viable business and with all stakeholders benefitting equitably from its returns. Technology, as it has done in the domestic oil and gas sector’s formative years will play a major role in achieving this objective. This is the 21st Century, let’s all rise to the occasion and realise our true potential, if not for our own selves but for the children’s future.

I thank you.”

 CARICOM MESSIAH

Heroic Henson

ExxonMobil tigers stole the show with Man of the Moment, the affable Rod Henson at the 2019 Energy Conference and Trade Show, hosted by the Energy Chamber .

Shimmering like the deepwater of Stabroek Block, Esso’s sparkling blue-eyed boy thrilled excited delegates as he presented an update on Guyana in his quiet American drawl. Hours later, Exxon announced two more offshore strikes on February 6, 2018, bringing the total discoveries offshore Guyana to a round dozen.

The vast majority, 9, were made under Henson less than 2 years after he became new Country Manager of Esso Exploration and Production Guyana Limited (EEPGL), in May 2017, replacing Jeff Simons who led the company’s operations since 2014. EEPGL is a wholly owned subsidiary of Exxon Mobil Corporation.

A graduate of Marietta College, with honors in Petroleum Engineering, Henson had a 28 year career with Mobil, ExxonMobil, and XTO Energy in global petroliferous provinces. He advanced through engineering and operations roles in the United States and Indonesia prior to the 1999 merger between Exxon and Mobil.

Following the merger, Henson worked in planning and leadership roles in the United States, Europe, the Middle East, Russia, and South America. He recently established the Argentina Division. of XTO Energy, a subsidiary of ExxonMobil.

The 7-island energy hub of Trinidad and Tobago wholeheartedly welcomes the handsome Henson, Esso’s elegant epitome of the generous oilman, supreme saviour of the regional energy industry. The future looks bright if the industry is led by this fine type specimen of the petroleum profession on whose slim shoulders rests the future of CARICOM energy supply.

“Guyana aspires to be tomorrow where Trinidad is now”  Exxon’s Henson tells EC conference

On the verge of becoming a significant player in the international petroleum industry, Guyana faces headwinds as it develops systems and capabilities to handle the technical complexities of petroleum technology.

Join Guyana energy boom
Esso invites firms to sign up

In his addreess on ExxonMobil’s operations offshore Esso Oil Baron Rod Henson highlighted the Guyana dilemma, longing to be where Trinidad is “tomorrow” without examining the century-long record of the CARICOM powerhouse .

He emphasised the work of his company and its contractors in harnessing local content. “Lastly, I wanted to touch a little bit on local content. Very proud of what we and our contractors have done in the area of local content. Trinidad has a long and mature oil and gas industry… Guyana is early in the journey, very early but moving along. The challenge has been that, Guyana looks to Trinidad and it aspires to be where Trinidad is or it aspires to be there tomorrow. Without considering that it has taken Trinidad decades to reach this level…” ExxonMobil, through subsidiary Esso Exploration and Production Guyana Ltd. encouraged Trinidad energy companies to participate in its petroleum exploration drive. President Rod Henson said firms should register with the Centre for Local Business Development in Guyana which is fully funded and operated by the company. He shared insight into what local firms can achieve.

The invitation comes amid the South American country’s energy boom. Henson told a packed auditorium that Guyana’s reserve of oil equivalent stood in the region of five billion barrels. ExxonMobil made 12 significant discoveries of oil and gas in Guyana since 2015.

Henson said Trinidad companies interested in doing work in Guyana should keep an eye on Exxon’s social media pages as well as apply to the centre which maintains a list of contractors.

“They maintain supplier quotable, which is a supplier list of a skills set which a company possesses and tries and match companies with the smaller contractors with what they need, so if you are interested in business opportunities, keep an eye on our website page, Facebook as well but also when companies come to Guyana, the centre is essentially the first place that we point people to.”

Trinidad provided a shore base at Chaguaramas during Exxon’s initial exploration drilling but this arrangement changed as the oil discoveries kept increasing.

“We were supported from a shore base perspective pretty much entirely from TT, however, but now we know we have a long term project in Guyana we have been working to increase our local content there and so today we operate a shore base in Guyana.”

Work, such as inspection and well services. was continuing out of its Chaguaramas shore base. Henson said TT has a “long and mature oil and gas industry” with many capable companies, something which Guyana was aspiring to build.

“There are many capable industries here and Guyana is early in the journey, very early… Guyana looks to Trinidad, they aspire to be where Trinidad is now but they do not consider that Trinidad has taken decades to be at this level.”

Henson gave an overview of future plans in Guyana saying Esso’s development plans were in two phases – one plan consisting of a floating production storage and offloading vessel, the Liza Destiny, and 17 subsea wells.

Liza Destiny has a production rate of up to 140,000 barrels of oil per day and a storage capacity of 1.6 million barrels. Esso expected “crude liftings” every week.

“We are on schedule for first oil in the first quarter of next year, and like all projects it will take some time to commission all the equipment so it will be a few months before we are up to peak rate.”

The Liza Destiny is being fabricated in Singapore with “sail away” scheduled for July/ August and commissioning later in the year. Well-heads and manifolds being manufactured in Brazil were all on schedule.

Henson said both phases are expected to tackle the upper and lower oil bearing sands and predicted that by 2022, Guyana should be producing 340,000 barrels of oil per day.

Trinidad companies working for Esso include ChagTerms based at Chaguaramas on the Gulf of Paria and Ramps Logistics which launched a subsidiary.

 It is time to award a GOLD STAR to recognize Esso’s stellar performance.

Energy Efficiency  Declaration

The Trinidad and Tobago Energy Chamber released the following Press Announcement on February 5 2019:-

Energy Efficiency Declaration

Recognizing the role of energy efficiency in simultaneously developing the economy and reducing Trinidad and Tobago’s greenhouse gas emissions, the Energy Chamber has developed an Energy Efficiency Declaration which it hopes will be embraced and adopted by its membership and the wider nation.   The Energy Chamber believes that energy efficiency is one of the immediate and impactful ways of optimizing the use of our finite natural resources.

Energy efficiency measures and initiatives will be crucial for the initial reduction of greenhouse gas emissions. Getting the industry to best in class levels of efficiency is the equivalent of unlocking a marginal field’s worth of gas. While some options may be more costly than others, collaboration across the sector presents opportunities to reduce costs and identify opportunities.

The overall benefit to the economy is an improved reserves to production ratio, jobs, lower emissions and increased levels of foreign exchange.

 The following member companies have already expressed their commitment to the Energy Efficiency Declaration:

Atlantic

bpTT
BHP Trinidad and Tobago
Damus Limited
EOG Resources Trinidad
Massy Energy
Shell Trinidad and Tobago Limited
The National Gas Company of Trinidad and Tobago

Methanol Holdings (Trinidad) Ltd.

Methanex Trinidad Limited

Yara Trinidad Limited

For the full text of the Energy Efficiency Declaration please see below:

Energy Efficiency Declaration

5th February, 2019

The international community has identified improving energy efficiency as a crucial objective to meeting the dual challenges of increasing demand for energy and combatting climate change.  Trinidad and Tobago has been consistently ranked as having one of the highest levels of energy intensity in the world and being one of the highest greenhouse gas emitters per capita.  Furthermore, over the past decade, Trinidad & Tobago has experienced significant shortfalls in gas availability for industry, resulting in negative impacts to the economy and contributing to the scarcity of foreign exchange.

Recognising the positive impact that higher levels of energy efficiency can have on both the economy and the environment, we the leaders in the energy sector, commit to optimizing the use of Trinidad & Tobago’s finite natural resources and to reducing greenhouse gas emissions through our activities.

The signatories to this Declaration will therefore endeavour to increase the levels of energy efficiency and conservation in the following areas:

• Facilities:- by examining the integration of energy efficient technology, programmes and policies into existing operations;
• Natural gas utilisation, electricity generation and electricity consumption:- by exploring and deploying opportunities to optimize the use of natural resources, raising the awareness of employees, contractors and partners and where applicable examining the use of renewable and sustainable sources of energy;
• Transportation:- through further collaboration in aviation, land & marine transportation logistics and where applicable the use of energy efficient technology.

The signatories to this Declaration further commit to:

• Working collaboratively with the Energy Chamber, other stakeholders in the sector and with the government and international community to ensure that the necessary policy and regulatory environment is in place to encourage investment in energy efficiency and other greenhouse gas reduction activities.
• Report annually, to the Energy Chamber, on the actions that we have taken to improve energy efficiency and decrease greenhouse gas emissions from our companies’ activities.

Deepwater adds a new dimension to regional energy

Under the theme of Technology: Transforming the Industry, sponsors included oil and gas stalwarts BP, SHELL, NGC, BHP, FIRST CITIZENS BANK, ROYAL BANK OF CANADA,, ATLANTIC, PROMAN, REPSOL, BAKER HUGHES, EOG RESOURCES, NI QUAN, WORLEYPARSONS, TOUCHSTONE, HYDRATIGHT, TUCKER, MASSY WOOD, ICSL, HYDRO TECH, PETERSON, PLNL, TENARIS, SCHLUMBERGER AND DUMORE.

PANEL 1 Bankers and industrialists
Prof. A. Persaud of the Barbados Government moderated a panel of –
BP. Claire Fitzpatrick
SHELL. D. Hudson
NGC. M. Loquan
BHP. V. Pereira
FCB. Karen Darbasie
RBC . D. White

PANEL 2 Technology Transfer, The Supply Chain and Local Content-
Moderator Dr. G. King of UWI led a panel of
SCHLUMBERGER. C. Chatar,
NIQUAN ENERGY . M. Wells,
DEEPWATER CORROSION SERVICES. J. Britton
TUCKER ENERGY SERVICES. R. Packer
WOLSELEY. G. Walden

PANEL 3 Leading the Transformation
Dr. Carla Noel-Mendez of BHP moderated a ladies panel of
BP. C. Fitzpatrick
EY. Pria Narinesingh
MEEI Penelope Niles
RE Siana Teelucksingh
BHP Kristen Ray

ORAL PRESENTATIONS
Speakers in a Session on Technology Shaping the Global Energy Industry included M. Stoppard of IHS Markit, A. Hashmi of BP, N. NcCormack of BHP and Jane Kearns of RBC.
Discussing Revolutionizing Education and Skills Development to secure the future of the Energy Industry, were Prof. Rose Luckin of London University, D. Cassidy of Proman, D. Hudson of Shell and D. Martin of Wood.
Caribbean Energy Update featured Dr. D. Gardner of CARICOM, T.Ketele of Staatsolie and R. Henson of Esso Guyana who deserves a CARICOM GOLD MEDAL for services to Energy.
The session, Downstream Energy Outlook featured NGC presentations by Dr. V. Paltoo of National Energy, D. Rampersad of PPGPL and M. Loquan., D. Patrick of Methanol Holdings, R. de la Bastide of Yara. and P. Rosenthal of Atlantic.
The session Upstream Energy Outlook was expertly presented by P. Baay of Touchstone, J. Pemberton of DeNovoEnergy, Jenna Joseph of Shell and K. Bally of BP.
New Fuel Technology was discussed by M. Wells of NiQUan and J. Milne of UNIPET.
Technology for a Low Carbon Future was reviewed by J. WIlkins of Rockwell and C. Narine-Thomas of EC.

WORKSHOPS
1. Secret Company Ownership was hosted by the British High Commissio, Delegation of the European Union, TTEITI and TTTI. High Commissioner T. Stew, Ambassador A. Biesebroek and AG Faris Al-Rawi were among presenters who discussed Beneficial Ownership.
2. Canada sponsored Best Practices in Energy Efficiency and Electricity.
Presenters on Trinidad & Tobago were G. Dulal, J. Lee Young, A. Hankey and A. Cazabon.
P. Gurnham was the featre speaker on The Nova Scotia Context. A Panel comprised . D. Roscoe of Roswall Inc., T. McLeod, of CBCL and C. Faulkner of EfficiencyOne Services.
3.A Round Table discussion followed excellent presentations by D. Boyce and R. Seehausen of INTECSEA, B. Donlon of BHP and S. Shakespeare of Subsea 7 on Developing a Deepwater Sector in the Caribbean.
This workshop deserves to be a Day 1 session in the Main Conference Programme in 2020 including Guyana.
It will certainly capture the hearts, minds and wallets of delegates.
Investment opportunities in deepwater basins of Barbados and Trinidad & Tobago follow the splendid success on Stabroek Block offshore Guyana. Local service companies and contractors can grow their business, applying half a century of offshore experience to extreme conditions in the new frontier, employing graduates in petroleum technology discarded in the meltdown at Petrotrin, now evolving into 5 bureaucracies. .
UWI has an excellent library including deepwater studies in volumes of the scientific Ocean Drilling Program, ODP, donated by ECO patrons since 2001.
A new regional company such as West Indies Energy Limited (WEL) can reduce bureaucracy and  lacklustre politics,  crossing borders to  reinvigorate the private sector which pioneered an iconic industry over a century ago, to serve a captive market with energy for transport and technology, now essential for development.