Trinity Exploration & Production plc

(“Trinity” or “the Group” or “the Company”)

MOU signed with The National Gas Company of Trinidad & Tobago Ltd. (“NGC”)
to explore and develop new energy projects

Trinity Exploration & Production plc (AIM: TRIN), the independent E&P company focused on Trinidad and Tobago, announces that it has signed a memorandum of understating (“MOU”) with The National Gas Company of Trinidad and Tobago Ltd. (“NGC”), to explore and develop new projects to enable energy transition in Trinidad and, potentially, in the wider Caribbean and Latin America.

NGC has been in operation for over 45 years and is strategically positioned in the upstream and midstream of the natural gas value-chain in Trinidad and Tobago. Its core business activities involve the aggregation, purchase, compression, transmission, sale and distribution of natural gas to industrial and commercial users. It also has non-operated interests in upstream producing assets, both oil and gas.

This collaborative initiative is part of Trinity’s and NGC’s wider growth strategies; aiming to derive further value from existing licences, to establish a broader portfolio of energy assets via acquisition and partnerships, and to challenge and further reduce carbon output.

As Trinity drives toward becoming an energy company of scale, strong relationships with highly respected businesses like NGC will be fundamental to achieving our long-term goals.

The MOU covers a range of development opportunities including:

• • A Micro Liquefied Natural Gas (“micro LNG”) business which encompasses potential synergies along the Gas Value Chain including potential opportunities for Compressed Natural Gas (“CNG”) in Trinidad and Tobago, the broader Caribbean and Latin America region;
  • Renewable energy opportunities, inclusive of a wind power generation project, to provide renewable electric power, including some ofTrinity’s operations;
  • Pursuit of stranded gas assets and associated opportunities in existing Trinity assets; and
  • Pursuit of other mutually beneficial business opportunities.

As the world continues its energy transition journey, these value-added initiatives will contribute towards maximising the benefits from Trinidad and Tobago’s natural resources. Furthermore, this supports Trinidad and Tobago’s ambitions towards lowering GHG emissions in line with best practice and the Paris Accord.

Bruce Dingwall CBE, Executive Chairman of Trinity, commented:

“Our traditional core onshore and offshore production assets provide a strong foundation for growth, but this partnership with the NGC potentially introduces new ways of operating, powering and monetising those assets which are truly exciting. This partnership is expected to be a great ‘enabler’ to Trinity becoming a new type of energy business which is at the forefront of the Energy Transition agenda.

“Automation and transition technologies are bringing a new dimension to our existing operations, and we will continue to advance opportunities to broaden our portfolio and create further value as we further scale the business. We believe that this MOU is an important milestone for the Company, and look forward to working alongside the NGC on these exciting new initiatives.”

Mark Loquan, NGC President, commented:

“This signing is indeed a significant one as it provides the NGC Group, and ultimately the people of Trinidad and Tobago, with an avenue to accelerate energy efficiency and renewable energy within the country. The scope of the MOU goes hand in hand with the Group’s Corporate Sustainability Strategy, which speaks to the role of the Group in the attainment of the country’s Paris Agreement obligations. The NGC Group has made great strides in diversifying its business model to ensure the sustainability of all our entities. The scope of this partnership with Trinity is therefore a strategic fit for the Group. The NGC Group is therefore set to advance the local chapter of the energy agenda.”

ESG Commitments

Environmental Social and Governance (“ESG”) drivers are at the core of the modern industrial society and Trinity is focused on establishing itself at the forefront of the Energy Transition agenda.

Trinity has been working for some time to reduce the environmental impact of its operations, having established its baseline for emissions in 2017. The Company has been embarking on an abatement plan during 2020 to ensure that it becomes a more efficient and cleaner business, and is on course to roll out further operational automation initiatives in 2021. Key onshore and offshore wells are being automated (driving efficiency and reducing energy intensity) and the acceleration of applied analytics, transition technologies and automation across the wider portfolio will further work towards our ESG objectives.

Micro LNG

Deploying micro LNG solutions significantly reduces transportation requirements for natural gas with volume requirements reduced by a multiple of 600 times.

LNG is a clean cheap transition fuel ideal for small, medium and large scale users. It also has immediate and growing use as a bunkering fuel for sea going vessels. Trinity has been reviewing the opportunity to be part of this supply chain for some time and believes it would be a strong, complementary, cash generative addition to our existing operations.

Renewable Energy

Powering conventional oil production by using alternative energy sources such as wind power has the potential to not only reduce the carbon footprint of each barrel produced but also to reduce the operating costs of extracting those barrels. Trinity has evaluated and deployed several means to reduce its operating costs since 2016, delivering an operating break-even consistently below US$30/bbl, and it continues to drive this initiative forward, including the powering of its own and ultimately other third party platforms and wells via alternative energy sources.

Curtis Mohammed, NGC CNG President; Jeremy Bridglalsingh, Managing Director, Trinity Exploration and Production (Trinidad and Tobago) Ltd; . Mark Loquan, President NGC and Vernon Paltoo, President, National Energy attended the signing.

TOUCHSTONE ENTERS INTO A NATURAL GAS SALES AGREEMENT WITH THE NATIONAL GAS COMPANY OF TRINIDAD AND TOBAGO

CALGARY, ALBERTA (December 18, 2020)

 Touchstone Exploration Inc. (“Touchstone”, “we”, “our”, “us” or the “Company”) (TSX, LSE: TXP) is pleased to announce that it has executed a long-term natural gas sales agreement with the National Gas Company of Trinidad and Tobago Limited (“NGC”) for all future natural gas production from the Ortoire block (Touchstone 80% working interest operator, Heritage Petroleum Company Limited 20% working interest).

Per NGC’s Media release dated December 18, 2020

NGC, Touchstone in gas supply Partnership

The National Gas Company of Trinidad and Tobago Limited (NGC) signed a natural gas supply agreement with Primera Oil and Gas Limited, a subsidiary of Canadian energy exploration company Touchstone Exploration on Friday 18th December 2020. Primera, acting on behalf of its Joint Venture partner Heritage Petroleum Company Limited, will supply gas from the Ortoire Block, initially from the Coho-1 field.

Chief Executive Officer of Heritage Petroleum Arlene Chow said:

“This strategic partnership is not only promising for the industry and the companies involved, but ultimately, it will greatly benefit the people of Trinidad and Tobago. ”

NGC’s President Mark Loquan noted that this signaled an important milestone in the country’s gas story:

“NGC is unwavering in its commitment to secure natural gas through innovation and strategic partnerships, especially in these challenging times. This is notable because onshore natural gas production has been for so long overlooked in the sector.”

He also congratulated the teams who worked on the agreement, affirming that, “…in an epoch where the energy industry here and globally rarely fields a good story, this one bodes well for Trinidad and Tobago.”

For more information:
Lisa Burkett, Manager, Corporate Communications
The National Gas Company of Trinidad and Tobago Limited (NGC)
Orinoco Drive, Point Lisas
Lisa.Burkett@ngc.co.tt

Operational Update

Touchstone has mobilized a service rig to the Chinook-1 location to perform a comprehensive completion and production testing program. The Company expects to perform three production tests to evaluate reservoir pressures and hydrocarbon deliverability of the Herrera sands observed while drilling and defined by open hole wireline logs. The first test will evaluate the previously untested subthrust Herrera sands, while the other tests are expected to investigate the potential of the intermediate and overthrust Herrera sand intervals. We anticipate final results from the Chinnok-1 production testing program in the first quarter of 2021.

Following testing at Chinook-1, the service rig is expected to immediately move to the Cascadura Deep-1 location. The Cascadura Deep-1 production testing program is anticipated to include flow and buildup testing of three zones of interest. The first two tests plan to evaluate sands observed in two previously untested thrust sheets in the intermediate Herrera that are below the sands observed in the Cascadura-1ST1 well, while the third test will assess the base of the sands which were observed but not fully penetrated in the Cascadura-1ST1 well.

Touchstone Exploration Inc.
Touchstone Exploration Inc. is a Calgary, Alberta based company engaged in the business of acquiring interests in petroleum and natural gas rights and the exploration, development, production and sale of petroleum and natural gas. Touchstone is currently active in onshore properties located in the Republic of Trinidad and Tobago. The Company’s common shares are traded on the Toronto Stock Exchange and the AIM market of the London Stock Exchange under the symbol “TXP”.

For further information please visit www.touchstoneexploration.com

Ortoire block holding 1TCF of gas cheers NGC

Dec 22 2020

The National Gas Company of Trinidad and Tobago Limited signed a natural gas supply agreement with Primera Oil and Gas Limited, a subsidiary of the Canadian energy exploration company, Touchstone Exploration on 18th December 2020.
Primera—acting on behalf of its Joint Venture partner Heritage Petroleum Company Limited—will supply gas from the Ortoire Block, initially from the Coho-1 field.
Cascadura-1ST1 well may be in one of T&T’s largest onshore gas reservoirs.
Ortoire Block may hold at least 1 tcf of gas. First production will begin in two to three months. Cost is competitive when compared to present producers.
Ortoire Block, with as much as one trillion cubic feet (tcf) of wet natural gas may potentially produce in excess of 200 million standard cubic feet of gas per day (mmscf/d) according to Paul Baay, director, president and chief executive officer of Touchstone Exploration Inc. First gas is expected as early as February 2021 ramping up to 100mmscf/d by the fourth quarter next year.

“First gas we are hoping will be delivered late February, beginning of March 2021 for Coho and then the Cascadura and Chinook volumes we anticipate bringing on in the fourth quarter of 2021.
When we look at all three, Cascadura, Cascadura Deep and Chinook we are looking at about 10 million standard cubic feet per day (mmscf/d) from Coho and roughly 80 to 100 mmscf/d from Cascadura/Cascadura Deep and Chinook combine.,”
100 mmscf/d and 2,000 barrels of condensate per day were expected to be produced from the field by the end of next year.
“When we are talking about a ball-park figure right now, we are probably talking about things that are about 5 to 600 billion cubic feet (bcf) with what we see right now, but I think ultimately it is fair to say that on the block we see the potential for there to be at least a tcf (trillion cubic feet) of gas onshore in Trinidad.”

Touchstone is not resting on its laurels and plans to continue its drilling campaign with a new prospect, which, if as successful as the company expects, could essentially double the volumes.

“It is a littler bit further to the East, I think about 11km to the East of Cascadura, and its a well that we call Royston. It’s the kind of prospect that we can see can add an additional 100 mmscf/d if it is successful.”

“I think there is a lot of potential off our block. We’ve identified besides the prospects we have been talking about, we have identified 21 additional prospects on our block and there are a number of technical leads all the way through from our block, as you move all the way west down to the South West Peninsula. Geologically it’s all the same down there, just some different technical faults, but I think we don’t own it all. Clearly geologically there will be some other major discoveries along this trend onshore in Trinidad.”

Discoveries on the Ortoire Block had opened new prospects and technical leads. Touchstone believes it is into a liquids-rich gas window and therefore is expecting gas and condensate rather than black oil.
The company will be able to produce the gas discoveries very quickly because of close proximity to existing infrastructure and because its costs are far more competitive than the price that the National Gas Company is presently paying for its molecules from the larger producers.

“It’s a combination of things. One there is already the existing pipeline that runs up to Phoenix park. It goes right through the middle of our block so the capital cost and the timing to bring that on are going to be significantly less than some of the offshore programmes and it’s just easier and cheaper to bring them on so you know, and I think that’s why we had the success in negotiating with NGC, is that they really see this as being the first gas that they can bring to market and that works for both of us. We’re trying to work with the pricing. The real trade off with us and the NGC is that we can find a price that makes sure the plants stay open and hopefully we can open up some of the trains that are shut in, while at the same time getting the right return for our shareholders and I think we have found that balance.”

NGC is reeling from a shortage of natural gas and higher prices for gas it was unable to sell to downstream petrochemical companies that found the prices too high, welcomes the good news.
Baay said the success of the drilling campaign means that there is far more knowledge about the prospects onshore and Touchstone is having discussions on how to go after these potential oil and gas opportunities.

“Without saying to much, it is fair to say we are talking to not only Heritage but other operators on the island as well and taking what we learnt in Ortoire, we think there are some opportunities, so we’re having some very open and positive discussions for sure and Heritage is just one of those parties.”

Touchstone’s ability to raise money on the London capital markets meant it has capital now to do both the exploration on the block as well as develop and bring it on stream.
“We think there are probably 4 to 8 development locations at Cascadura and 4 to 8 development opportunities at Chinook so it is really going to become quite frankly a five year or ten year drilling plan onshore now that will be, thanks to the capital we raised in London, going to be self financing pretty quickly. Its going to be very busy quite frankly for the next ten years, I think this is really exciting obviously for us but also for the country.”

Baay said oil producer Touchstone was happy with provisions in the 2021 budget which removed Supplemental Petroleum Taxes (SPT) from being applied to companies that produce 2000 barrels of oil and fewer a day up to the point where crude price reach US $75 a barrel and above. It is a good first step but more has to be done.

: “I think it’s a positive step but I would hope that the government would extend it further like higher volumes and for a longer period of time so that it kind of gives a longer view as to what to do but to be clear I am pretty happy with that being the first step that we’ve made. I think it’s a step in the right direction for sure. Hopefully what it will do is get more activity, hopefully in the south of the island, like around Fyzabad where we are and forest reserve. That particular change in the SPT is very helpful for us down there and you will see us be very active in that area as well during 2021.”

Touchstone announces Cascadura Deep-1 results

3 Dec 2020

Touchstone Exploration completed drilling the Cascadura Deep-1 exploration well on the Ortoire exploration block, onshore in Trinidad and Tobago (Touchstone 80% working interest operator, Heritage Petroleum Company Limited 20% working interest) and announced that the well encountered significant hydrocarbon accumulations based on drilling and wireline log data.

Highlights

• • Cascadura Deep-1 was drilled to a total depth of 8,303 feet. Drilling was suspended prior to the planned total depth of 10,600 feet due to high pressure gas zones encountered while drilling.
  • The well encountered total sand thickness of 2,100 feet in multiple, stacked thrust sheets in the Herrera section.
  • Wireline logs indicated natural gas pay totaling approximately 1,315 net feet in four unique thrust sheets in the Herrera sands from a depth of 5,455 feet to total depth.
  • An aggregate 1,007 net feet of natural gas pay was identified in the overthrust sheets, an increase of approximately 20 percent compared to the Cascadura-1ST1 discovery.
  • Additional natural gas pay of approximately 308 net feet was encountered in two previously untested Herrera thrust sheets below the sands observed in the Cascadura-1ST1 well.

Paul R. Baay, President and Chief Executive Officer, commented:

‘I am pleased that the Ortoire block continues to outperform our expectations. The Cascadura Deep-1 well is the best well we have drilled on the Ortoire property to date and it has provided three key pieces of information, primarily that the Cascadura field has numerous targets with each one of the thrust sheets providing its own unique opportunity. It has also shown that the system is hydrocarbon charged and that in time we will require more drilling horsepower to evaluate the deeper zones. We now have a unique opportunity to design a development drilling program in the area and expand our exploration program while we complete and tie-in the existing Cascadura and Chinook wells. The time required to undertake this will allow us to secure additional equipment and submit a full field development plan to proceed with a continual drilling program. As we move into 2021, Touchstone is entering a new phase that will see rapid production growth along with a balanced portfolio of development and exploration opportunities.’

The Cascadura Deep-1 well was drilled to a total measured depth of 8,303 feet (true vertical depth of 8,133 feet) on November 30, 2020. While the well was originally planned to be drilled to a total depth of 10,600 feet, the gas sands encountered in overthrust Sheet 4 proved difficult to manage, and the decision was made to cease drilling to preserve the substantial pay section encountered in the well.

Drilling samples and open hole wireline logs indicated that the well encountered a significant Herrera turbidite package with a total thickness of over 2,900 feet containing in excess of 2,100 feet of sand, with an aggregate 1,315 net feet of natural gas pay in four unique thrust sheets.

The well encountered 558 net feet of hydrocarbon pay in the Gr7bc section of the overthrust Herrera sands at measured depths between 5,450 and 6,050 feet. These sands, locally referred to as the Sheet 3 overthrust sands, correlate to the sands discovered and tested at Cascadura-1ST1 at depths between 5,516 and 6,162 feet. The gross section encountered in Cascadura Deep-1 was 20 feet less than observed in Cascadura-1ST1 which is located approximately 900 feet to the northwest.

The well encountered 449 net feet of hydrocarbon pay in the Gr7abc section of Sheet 4 of the overthrust Herrera sands at measured depths between 6,050 and 6,532 feet. These sands correlate to the lower sands discovered and tested in Cascadura-1ST1 at depths between 6,162 and 6,350 feet. The gross Sheet 4 section encountered at Cascadura Deep-1 is more than 245 feet thicker than sands observed in the Cascadura-1ST1 well and is consistent with the Company’s models based on seismic data.

The intermediate Gr7bc sands were the Company’s primary target originally identified in the offsetting BW-5 well. 308 net feet of hydrocarbon pay was identified in two thrust sheets within the Gr7bc section of the intermediate Herrera sands at measured depths between 7,086 and 8,246 feet. The sands encountered in one of these thrust sheets correlate to the offsetting BW-5 well while the other thrust sheet was not encountered in the offsetting well; neither thrust sheet has been previously tested.

James Shipka, Chief Operating Officer, stated:

‘The Cascadura structure continues to exceed our expectations, and the Cascadura Deep-1 exploration well confirms that this is a unique structure with tremendous potential. Although we were unable to drill to our planned total depth, the information gathered while drilling and the hydrocarbon accumulations encountered are truly exceptional. Not only did we encounter a massive section of turbidite deposits nearly 3,000 feet thick, we established the intermediate thrust sheet as a viable reservoir and expanded the known boundaries of the sands tested in the Cascadura-1ST1 well. In the intermediate section, wireline data identified in excess of 300 feet of prospective pay in two thrust sheets, one of which has not been previously encountered in the area. While those 308 feet of sand met the threshold for pay based on log data, wellsite sampling saw hydrocarbon indicators throughout the entire section which we aim to gain a better understanding of through our production testing program. In the sands previously evaluated in Cascadura-1ST1, we were able to not only confirm the continuity of the structure, we were able to identify the base of the sand package at nearly 200 feet below the total depth of the original well. Finally, the information obtained at Cascadura Deep-1 provides great insight into what was observed at the Chinook-1 well which the Company expects to commence production testing later this month.’

The Cascadura Deep-1 exploration well was spud on October 27, 2020 using Well Services Petroleum Ltd. Rig #80. The well was designed to explore the potential of a thick sequence of Herrera sandstones contained in a series of thrust sheets which were observed in the offsetting BW-5 well as well as the recent Cascadura-1ST1 and Chinook-1 discoveries . The primary target of the Cascadura Deep-1 well were the Gr7bc Herrera sands in the intermediate thrust sheet at an approximate measured depth of 7,600 feet. These sands were interpreted to correlate to, but separate from, the sands observed in the Company’s Chinook-1 discovery. The well was intended to further evaluate a secondary target of a repeated section of Gr7bc Herrera sands in a subthrust sheet from approximately 9,500 feet to a planned total depth of 10,600 feet.

The Cascadura Deep-1 well is the fourth of the amended five well exploration commitment under Touchstone’s Ortoire Exploration and Production Licence. The Company has an 80% working interest in the licence but is responsible for 100% of the drilling, completion and testing costs associated with the initial five exploration wells. Heritage Petroleum Company Limited holds the remaining 20% working interest. Touchstone had no reserves booked for the Cascadura Deep-1 well in the Company’s December 31, 2019 independent reserves report. Further testing is required to determine the economic viability and potential of the well, and the Company plans to commence completion and production testing operations during the first quarter of 2021.

Source: Touchstone Exploration

Last king of Babylon

Dec 16 2020

Persians destroyed Babylon hours after noble exile Daniel prophesied disaster at the feast of Belshazzar. Petroleum prophets likewise saw handwriting on the wall of the Ministry of Energy. State divestment is the obvious solution for energy woes. Government must end suffocating over-reach in the running of the company instead of forcing NGC to spend tax millions on TAR for Atlantic LNG Train 1 without gas which major shareholders deem unworkable. The role of management is to maximise shareholder value with decisions that make economic sense. Government is not the sole shareholder in the NGC and votes for shareholders by proxy. .It must take the bull by the horns and staunch the futile bleeding of taxes.

The business model of attracting downstream investment because of an abundance of cheap natural gas, political stability and easy access to an uncompetitive US market is now unsustainable. Natural gas discoveries are few and far between, smaller than the several trillion cubic feet of the past. . Gas is now valuable on its own and no longer flared as a by- product of oil . Unit cost per molecule has increased dramatically. Massive reserves in the US are a by-product of oil. The tables have turned and the outlook has changed.

Middleman National Gas Company moved from major margins, paying regular dividends, to its first loss, failing to be profitable in a market where the petrochemical sector cannot pay the prices NGC charges for natural gas. Downstream companies are prepared to stand down and shut plants rather than sign agreements under terms that will not lead to free cash flows.

Titan Methanol spent a quarter of a billion dollars on a turnaround (TAR) hoping to buy gas at a price that made business sense. NGC did not deliver and consequently, the plant remains idle.

NGC negotiations with Methanex and other downstream companies are not proceeding well. Fear grows that more plants will be forced to close because NGC prices are unsustainable. NGC is not a natural gas producer and its prices are impacted by deals with upstream producers. Monopoly status by definition means bloated NGC is inefficient. Restructured as a gas transportation company and an LNG trader, it may become more efficient with loss of jobs. its communication department is five times that of Royal Dutch Shell in T&T and over twice that of BPTT.

Like its oil counterpart Petrotrin, NGC has a history of colossal wastage of taxpayer shareholders funds. It spent a billion dollars on a waste- water plant that was not completed. It squandered resources on entertainment and sponsored Bocas Literary Festival for a decade. In 2020 UWI exploited the event for slavery reparation for a minority, even as the NGC future was bleak.

After 5 years in power, a graspng government gropes in the dark, failing to end an energy nightmare, transform the economy, link energy to manufacturing. and produce and sell petroleum while investing for the RE future.

 

Low commodity prices crush NGC margins

Dec 16 2020

Energy minister Franklin Khan told senators of a dramatic drop in the profit margins at the state-owned National Gas Company. Questioned by the Opposition about NGC profitability, Khan confirmed that margins sank from 22 per cent in 2018 to a mere 7 per cent in 2019.

“National Gas Company financial performance for its financial year 2019 was adversely impacted by falling prices for petrochemicals and natural gas. These commodities account for almost 75 per cent of NGC’s revenue.”

The combination of lower market prices and increased cost resulted in the “compression of gross margins from 22 per cent in 2018 to 7 per cent in 2019 and thus the lower profitability”.

The company was also affected by the global contraction triggered by the COVID-19 pandemic.

“The financial performance of the company is further impacted by COVID-19, as prices of commodities in particular methanol, ammonia, LNG and crude oil impacted on profitability and liquidity in the company remained depressed throughout 2020. NGC strategy towards improving profitability involves value creation and optimisation within its operation.”
The company ensured the reduction in project overruns to reduce losses.
“The company is also enhancing the value of its operation across the entire value chain and within NGC to drive synergies and optimisation.”

Khan accused the Opposition of “missing the point”.

“We have commodities that we sell. Oil, gas, petrochemicals in particular, methanol and ammonia. Once the markets for these commodities remain depressed, there will be a challenge. We are price takers, we do not set the price.”
Even though NGC was involved in the gas value chain, it was still at the mercy of the market.
“We have to hope the global economy starts to rebound as soon as possible.”
That was why the COVID-19 vaccine was so important.
“We have to get market for our products and market that offer attractive prices and attractive prices are based on supply and demand. It has nothing to do with what we are doing here.”

The Opposition asked about the upstream market deals in Houston with EOG Resources last year.

“NGC is an aggregator and prices are based on what we call a ‘price curve’. There is a base price and you get a higher price based on commodity pricing. It is not based on upstream.”
When prices for methanol and ammonia are high, “everybody is laughing towards the bank. We are in a depressed market and we just have to hope that the global economy picks back up. “ Profitability was less reliant on NGC’s upstream cost price than on its downstream selling price. The cost of upstream production was rising owing to smaller gas fields being exploited.

NGC, Atlantic, BPTT and Central Bank

Wed Dec 16 2020

Promising if it becomes operator of Atlantic LNG Train 1 it will not be at the expense of the downstream petrochemical sector, NGC, in a risky gamble agreed to spend hundreds of millions of dollars on an end-of-life turnaround (TAR) of Train 1, after key shareholders, Royal Dutch Shell and BPTT emphasised they lack gas for Train 1 and were not prepared to embark on a TAR without hope of returns on enormous investment.   Unable to secure 400 million standard cubic feet per day (mmscf/d) of natural gas to fully operate Train 1, NGC was instructed by a quixotic government to save Train 1, including the major expenditure. NGC faces a difficult dilemma with plants closed because of weak commodity prices for methanol and ammonia, after years of gas shortage from curtailment.

If there was a way forward for Train 1 the company said “NGC has met and will continue to meet its downstream obligations. All discussions between NGC and the Train 1 shareholders is and remains strictly confidential and NGC is therefore precluded from making and proffering any comments on same.”

Energy Minister Franklin Khan recently told Parliament that partners had agreed to the TAR .
“Atlantic Train One will not be shutting down in January 2021. Train One will continue to operate in 2021 and will be part of wider negotiations which have been taking place among the Atlantic LNG shareholders to form one unitised facility encompassing all four trains.”
With gas production already low, Khan agreed that confidence in the continuation of Train 1 remains even though the NGC does not yet have the gas to operate Train 1 . It requires at least 250 million standard cubic feet of gas per day (mmscf/d) for the compressors to function..
” BP is not the only supplier of gas in Trinidad. So we are in some sensitive negotiations,.., with upstreamers to supply gas to Train 1.”

Train One currently is owned by Shell (46 per cent), BP (34 per cent), Chinese Investment Corporation (10 per cent), and the. NGC (10 per cent).
Shareholders of Atlantic Train 1 approved the turnaround (TAR) – a maintenance schedule – in January for the train.

“This will keep the train in an operations-ready mode for all of 2021 into 2022.”

For the last 21 years BPTT delivered 100 per cent of the gas for Train 1. The company no longer has the gas and has not provisioned for gas to supply Train 1. It expects a catastrophic fall in its production and has not allocated a molecule of natural gas for Train 1.

BPTT expects an average of 1.371 billion standard cubic feet of natural gas per day in 2021. In March the company produced over two billion standard cubic feet per day and averaged up to September this year 1.8 billion standard cubic feet per day.
BPTT refused to be drawn on Train 1 but admitted that next year its production will be down. The COVID-19 pandemic negatively impacted its projects to be completed in 2021 which would now be finished in mid-2022.

“In terms of production, 2020 and 2021 have been impacted by the disappointing results from our infill drilling programmes at the beginning of 2019. Following the results of the infill drilling programme in 2019, we sought to mitigate production declines by increasing our focus on well work and system optimisation to maximise production from our existing fields. These measures had the desired effect in 2019 and 2020 of slowing the rate of natural field declines. We will continue our focus on well work and system optimisation into 2021, however, our outlook for next year has been impacted negatively by COVID-19.”
The pandemic impacted the schedule for the Cassia Compression project, with start-up delayed from 2021 into 2022.
“The combined effect of natural field declines and the delay in the Cassia Compression project means that our production outlook for 2021 will be lower than 2020.”
BPTT anticipates that in 2022 production volumes will improve with the start-up of the Cassia Compression and Matapal projects.
“We expect that both of these projects will be online in the first half of 2022 and those volumes will be put towards fulfilling our existing contractual obligations for Trains 2, 3, 4 and NGC.”

Negotiations continue even as the Central Bank published numbers showing major declines in the petrochemical sector and headwinds the energy sector is facing.
Available indicators suggest that energy sector activity remained further constrained in the third quarter of 2020, declining 20.1 per cent. Effects of the COVID-19 pandemic on economic activity include significant year on-year declines in local production of natural gas (19.9 per cent). Refining activity fell 20.1 per cent, evidenced by declines in LNG (19.9 per cent) and NGLs (20.8 per cent).

The Monetary Policy Report (MPR) read; “Downstream activity was also adversely impacted, following the trend of upstream counterparts, as petrochemical output fell (31.1 per cent) over the three month period. The notable decline was driven by a 49.6 per cent falloff in methanol production, on the heels of closures to the CMC, TTMC II and Titan facilities during the period. Additionally, ammonia output fell 16.8 per cent (year-on-year) over the period.”

Midstream and downstream activities weakened with refining activity falling by 4.8 per cent compared with the first half of 2019. LNG production decreased by 4.0 per cent, while NGL production fell by 7.3 per cent.

“Activity in the petrochemical sub-sector contracted by 7.1 per cent in the first half of 2020as several domestic petrochemical plants closed due to the dampening effects of the coronavirus on commodity markets and the world economy at large. Production of methanol fell by 9.2 per cent (year-on-year) in the first half of 2020. Notwithstanding a marginal 1.1 per cent increase in urea production, fertiliser production fell by5.2 per cent, weighed down by a 6.0 per cent fall in ammonia production.”

Central Bank reports decline

Dec 15 2020

The Monetary Policy Report of the Central Bank (CBTT) paints a grim picture of economic activities contracting in the first half of 2020 in energy and non-energy sectors, with a fall in output of natural gas, crude oil, liquefied natural gas (LNG) and petrochemicals, especially methanol and ammonia.

“As several businesses closed and others reduced their operations, declines were recorded for several non-energy sectors, such as Wholesale and Retail Trade (Excluding Energy), Construction, and Manufacturing (Excluding Energy and Petrochemicals).”
Labour market adjustments included furloughed employment, layoffs, pay cuts, and reductions in working hours.
“Despite the gradual re-opening of the economy, labour demand softened, resulting in higher retrenchments. Job advertisements in the print media, a proxy for labour demand, declined during May to October 2020.”

Growth was recorded for Real Estate Activities and the Financial and Insurance Activities.
Government accounts came under increased strain in fiscal year (FY) 2019/20 as a result of the COVID-19 crisis.  Data from the Ministry of Finance show that the budget deficit jumped to 11.2 per cent (as a per cent of Gross Domestic Product (GDP)) in FY2019/20 from 2.6 per cent in FY2018/19. Public revenue collections declined by 27.1 per cent in FY 2019/20 from FY2018/19 due to lower energy prices and a smaller corporation tax take as business operations were curtailed.

Public expenditures, however, increased due to higher outlays on transfers and subsidies and the capital programme to shore up the health system and support those adversely affected by the pandemic.
Conditions in the foreign exchange market remained relatively tight during the first ten months of 2020. Purchases of foreign exchange by authorised dealers from the public declined over January to October 2020, relative to the same period a year prior.

This decline in purchases was related to a reduction in conversions by energy companies, while the demand for foreign currency also slipped in the context of trade and travel restrictions as well as the state of aggregate demand. By the end of November 2020, official international reserves stood at US$7.1 billion or about 8? months of import cover.
The global economy suffered an unprecedented fall in real output over the first half of 2020 mainly because of the COVID-19 pandemic. Governments introduced public health measures such as lockdowns, social distancing, and closures of non-essential businesses, which resulted in sharp and deep economic contractions during the first six months of the year.

Global demand has been rising slowly as some economies relaxed lockdown measures in May and June prompting measured improvements in economic activity.
The CBTT expects the domestic economic outlook in 2021 will be centred around the lingering effects of the pandemic, which are expected to persist well into the first three quarters of the new year. T&T had a relatively good starting point, with significant buffers, including sizable international reserves and its sovereign wealth fund (Heritage and Stabilization Fund) but, given the finite nature of these buffers it is imperative that the transition be managed very carefully.

“As in most other countries, fiscal action will remain at the core of the combined macro-economic policy response. A delicate balance will continue to be required in providing indispensable support to the poor and disadvantaged communities—who have been disproportionately impacted by the pandemic—while keeping an eye on the debt situation.”

Pointe-a-Pierre refinery

6 December

Patriotic Energies and Technologies Co Ltd is awaiting word from Cabinet on whether its bid to operate the Guaracara refinery was successful.
The reconstituted evaluation committee delivered to Cabinet the review of the proposal Patriotic first submitted on October 31.

That proposal was initially rejected by Energy Minister Franklin Khan. In an almost immediate change of heart, the Prime Minister instructed the evaluation committee to take a second look at the proposal and make further comments and recommendations.

The report was delivered to Cabinet on November 30. Patriotic had no communication on the topic since.

“We have not heard from the Government or the negotiating team,” Richard Lee, a Patriotic director said.

Oilfield Workers’ Trade Union (OWTU), Patriotic’s parent company, anticipated an announcement in Parliament .

“We have done all that was required of us. We are optimistic we will be successful.”

The Prime Minister said, “I am hoping there is something there that we would like to work with, because I too would like to see the refinery started and in the hands of local people. If there is no workable and no useable arrangement in that proviso, then we might have to go out. I can’t tell you whether they will get it. It is not mine to give.. It is a process the Government is going through.”

The refinery, located in Pointe-a-Pierre, along with the former state-owned Petrotrin was shut in November 2018. The OWTU subsequently offered a bid to acquire and operate the refinery and port. It established Patriotic and was successful in the refinery bid from among over 70 expressions of interest.

Trinity Power Ltd

The private electricity plant, an independent generator of 225 megawatts output, at Point Lisas is being sold by its US owners, Western Generation Partners, to a UK firm, ContourGlobal. T&TEC contacted the general manager of Trinity Power Ltd. Trinity confirmed this process has started for acquisition of Trinity Power Ltd by ContourGlobal. The present owner of Trinity remains. T&TEC will be notified when the transaction is completed.

U-Turn wins IDB award for innovation

Minister Rohan Sinanan says many lives have been spared with the U-Turn System, implemented this year, which won his ministry the Inter-American Development Bank (IDB) President’s Award for innovation in the public sector. The ministry won the 2019/2020 award with its entry, the software management system to support the implementation of the Demerit Points System, a new fixed-penalty or traffic ticketing system and a red-light and spot-speed camera enforcement system.

Venality versus Validity

The Tenth Commandment : Thou shalt not covet

Leave our property alone, saith the PCTT ….At the chapel of the Prime Minister’s grand residence, the leader would have heard of the Ten Commandments. A religious minority, the Presbyterian Church (PCTT) stands firm in its position that its schools, including prime real estate – buildings and land – are its property and it is not prepared to relinquish ownership to the State. The agreement between the State and the denominational boards as outlined in the 1960 Concordat gives it certain rights, privileges and responsibilities and these must be maintained as government reviews the education sector.

During public education consultations in November, the Prime Minister alluded to the hefty cost of assisting denominational schools, with wages and salaries for teachers, maintaining buildings and selecting students who attend these schools. The PCTT Board wrote to the Secretariat on the National Consultation on Education reaffirming its position on the validity of the Concordat, signed by Education Minister John Donaldson and the RC Church.

Through legal precedent other denominational bodies were legally joined to the agreement. The letter, signed by Moderator Rev Joy Abdul-Mohan and Synod secretary, says the church is of the considered view that  use of its lands and buildings for the establishment of schools entitles it to the arrangement contained in the Concordat.

“The policies, practices and principles enshrined in the said document are still valid and must be maintained. These fundamental rights are also enshrined in our Constitution.

“The Concordat allows a continuing relationship between the State and denominational bodies that ensures mutual benefits to both parties. The State has the opportunity to provide schooling for the nation’s children while the denominational bodies have assurance for the preservation of their religious beliefs and culture in their schools. This is clearly a symbiotic relationship meant to benefit all citizens.”

The letter said in a 2008 memorandum of understanding, the Ministry of Education agreed to wholly fund repairs, renovations and construction of the Presbyterian schools and nothing has changed.

“We maintain that our present arrangement as it pertains to the Concordat is in the interest of both the State and the church.”

The church assured its commitment to work with Government to achieve excellence in education and asserted that the agreement under the Concordat is critical to achieving these goals. Denominational boards answered a call to provide spaces and quality education for children of compulsory school age when the State was able to provide spaces for only 30 per cent in government schools.

Figures quoted by the Prime Minister show there are currently 611 primary and secondary schools, of which 227 are government schools and 384 government-assisted schools. On the basis of policies of the Ministry of Education, the boards agreed to give the State full access to school places at the primary schools and 80 per cent at the secondary level, retaining a right to 20 per cent of the intake on the basis of the former 11-plus exam. In exchange, the State undertook to meet some of the cost of education, which it continues to do, although the primary and secondary school boards contribute to maintenance and administration of their schools.

Presbyterians followed Christian education pioneers and rural residents who worked to overcome hardship and discrimination must resist attempts by a materialistic ruling elite to deprive them of educational opportunities, the passport from poverty to positive prosperity in neglected countryside communities.

As government schools fail to instill discipline and maintain high standards and UWI flounders from the CXC scandal, faith schools soar academically and spiritually. Characterised by powerlust, greed and jealousy, the regime which penalised the populace with property tax and cuts to higher education, casts an envious eye over church assets, having ruined the economy amid escalating crime and murders approaching 400.

bpTT sheds 149 staff

Dec 17 2020

bpTT confirmed as many as 149 people were either severed or took voluntary separation between September and November from Trinidad and Tobago’s largest natural gas producer as it completed restructuring.

While its ‘frontline staff’ was not impacted, office based roles were reduced by 25 percent globally. In T&T 149 people left the supermajor.

“We have completed the process of notifying employees of the outcome of the restructuring. As a result of this exercise, 149 employees will exit bp’s Trinidad business on a voluntary or involuntary basis. The majority of exits will occur in January 2021. We are deeply saddened that we are unable to take all of our employees with us on our journey as we reinvent bp. The global environment and the changing energy demands have required us to make fundamental changes to how we are structured and to our operating model and sadly, that means we will be saying farewell to some of our colleagues and friends. We are committed to treating our employees who are leaving with the utmost respect, care and dignity throughout the process and are doing all that we can to prepare them as they leave our company. We are also providing ongoing support to all staff through our employee assistance programme.”

Bidding farewell to some staff,, bpTT created new opportunities for many nationals who will enter new roles in BP.

“Approximately 47 employees have been assigned to roles that support operations outside of Trinidad and Tobago. Some of those roles will be based in Trinidad and some will be international assignments. This is a testimony to the quality of the talent that has been nurtured and developed in bpTT.”

Organisational changes will not affect sanctioned projects and activities in Trinidad which will continue as planned. The company remains committed to developing its gas resources, while at the same time progressing opportunities to decarbonize gas value chains and develop new, low-carbon businesses, in service of bp’s new purpose and ambition. bpTT remains committed to the development of its people and to contributing to the broader development of Trinidad and Tobago.

bp Trinidad and Tobago (bpTT) Victoria Avenue , Port of Spain – SUREASH CHOLAI