1) Heritage $2.3b pre-tax profit
28 APRIL
T & T State-owned Heritage Petroleum Co Ltd, posted a pre-tax profit of $2.3 billion for the year ended September 30, 2024, up $128.2 million from a year earlier, according to its audited results published yesterday. After paying $1.36 billion in taxes for the year, Heritage profit of $940.3 million, fell from $1.48 billion in 2023. Chairman Michael Quamina said the latest tax payment brought the total contribution to revenue to $14.75 billion.
“Heritage achieved a profit before tax of $2.30 billion (2023: $2.18 billion), marking a 6% increase from the previous year. We met all commitments to investors while paying $2.95 billion in royalties, levies and other taxes to the Government of the Republic of Trinidad and Tobago. As at 30 September 2024, since inception, the Company has contributed $14.75 billion to the Government in royalties, levies, and other taxes. Heritage maintained another strong financial performance in 2024,”
“Revenue from contracts with customers totalled $8.2 billion for the year, down from $9.1 billion in 2023. Revenue for 2024 comprised $7.76 billion from crude oil sales, $168.8 million from natural gas sales, $305 million in royalty income and $11 million from natural gas liquids sales.
“Overall, Molo crude revenue increased both in volumes and price. However, this was offset by the decrease in traded cargo volumes. Molo crude revenue increased by 8% year-on-year as the heavy crude market strengthened. Gross profit margin increased from 28% in 2023 to 37% in 2024 as we lowered costs, improved margins and reduced activity in high-cost fields.
“Capital expenditure rose 23% to $1.08 billion, up from $880 million in 2023., reflecting continued investment in production, asset integrity, developmental drilling, infrastructure, and technology. Heritage also paid $1.2 billion in principal and interest, meeting all legacy debt commitments for the Trinidad Petroleum Holdings Ltd (TPHL) Group of Companies. To date Heritage has repaid $8 billion towards the legacy debt.
“In 2024, Heritage Petroleum Company Ltd maintained healthy financial and operational results and continues to drive improved recovery in its assets through technology and modernisation. Heritage successfully drilled and completed eight wells in onshore and offshore fields. Offshore, we significantly reduced the time from drilling to production, underscoring our commitment to being Bigger, Bolder and Faster. Cost discipline and fiscal practices enabled us to cover operational costs, capital investments, as well as fulfil all financial obligations, including taxes and loan repayments. In summary, fiscal year 2024 was another strong year for the Company, further demonstrating it to be a sustainable source of production and value for Trinidad and Tobago. Reserve Replacement Ratio (RRR) increased by 8%, from 65% in 2023 to 73% for 2024. The Reserves to Production Ratio (R/P) is 7.5 years, and we expect RRR and R/P to continue to increase in the coming years based on planned activities for both our onshore and offshore assets. Five year average RRR is 107%, surpassing the five year average last year for Global International Oil Companies, which was 73%, Quamina stated.
Higher output with new wells planned
“Heritage continued to average approximately 40,000 barrels of oil per day. East Soldado remains a key area to drive production and growth. We have several new wells producing in this area, and we are targeting four similar wells in 2025. In addition, we are exploring new areas, extending existing field outlines, and drilling untapped areas within our existing fields. We continue to renew and modernise our infrastructure to minimise down time and improve base performance, helping drive future production growth. To grow production, Heritage intends to continue drilling new wells, onshore and offshore, while improving field performance through production optimisation initiatives, including state-of-the-art technology.
“We continue to invest in high-margin opportunities for sustainable growth by planning at least twelve new wells and related works in fiscal year 2025 to boost output, improve recovery and extend field life. With remote monitoring technology, we expect to continue to enhance onshore and offshore well uptime and reduce lifting costs.
“With six years of strong performance, Heritage is positioned for long-term success in the ever-evolving energy landscape. Our strategy of disciplined cost management, prioritising high-margin opportunities, upgrading our portfolio and driving sustainable operations will continue to deliver strong results for the Company and for Trinidad and Tobago.
“Additionally, we are evaluating new licence opportunities and extendingcore licences to include deeper potential. Asset integrity projects are progressing to maintain safety, reliability, and efficiency of operations. This includes regular maintenance, renewals and replacements and application of cutting-edge technologies to prevent failures and extend asset life.”
US Gulf refiners pay premium prices for Trinidad’s Molo crude
Heritage CEO Erik Keskula told Reuters during the Energy Conference that Heritage will continue marketing cargoes to U.S. Gulf Coast refineries to promote competition, leading to firm prices in that region.
“We trade sometimes at a slight premium to Brent as the mix of crude we have is in fairly high demand, especially in the Gulf Coast of the U.S.,”
Some U.S. Gulf Coast refiners recently paid prices over the Brent crude benchmark for Trinidad and Tobago’s Molo heavy sour crude, driven by lower availability of popular Latin American heavy crude grades since last year, including regional benchmarks, Maya from Mexico and Merey from Venezuela and prolonged output cuts by OPEC+ members.
Trinidad and Tobago is a marginal crude supplier to the Gulf Coast but exports have ramped up in recent months. Last year, the U.S. imported 44,000 barrels per day of Trinidad crude versus 36,000 bpd in 2023, according to the Energy Information Administration.
2) Opposition sails to victory in Trinidad and Tobago
Vanessa Buschschlüter
BBC News 29 April
29 April
The opposition won a decisive victory in Monday’s parliamentary election.The win by the centrist United National Congress (UNC) party means that Kamla Persad-Bissessar will be appointed as the next prime minister. The 73-year-old held the post once before, from 2010 to 2015 but her party was defeated in the last two elections by the centre-left People’s National Movement (PNM). Preliminary results suggest the UNC, which campaigned on a promise to raise wages and create employment, managed to win a number of parliamentary seats previously held by the PNM.
PNM leader Keith Rowley conceded defeat , saying that it had not been a good night for his party and that it was clear that it had lost the election. Rowley, 75, served as prime minister from 2015 to March of this year, when he announced he was stepping down and handing the reins of power to the 50-year-old energy minister, Stuart Young.
Rather than serving out the remainder of Rowley’s term, Young called a snap election hours after being sworn in as prime minister, seen as an attempt to secure a stronger mandate amid criticism by the opposition that his elevation to prime minister was unconstitutional. The election came at a time when the country is grappling with a rise in homicides and an economic slump. The outgoing government declared a state of emergency in December, which stayed in force for 105 days.
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During her campaign, Persad-Bissessar promised to raise wages for public sector workers, struggling to meet rising costs of living. It was an issue she addressed again after the governing party had conceded defeat.
“This victory is for the senior citizens to keep their pensions. This victory is for public servants to get their rightful salary increases. This victory is to re-open the children’s hospital. (…) This victory is once again to give laptops to our children and to create over 50,000 jobs,” she told supporters at the party headquarters.
She also assured those gathered that “no-one” would be left behind, stressing that “when UNC wins, everybody wins”.