The Energy Chamber of Trinidad and Tobago (The Energy Chamber)
January 17th, 2023
In the past two years, we have seen the role of natural gas increase in importance, both in terms of global energy security and in the pursuit of a low carbon future. This places the need to secure our natural gas supplies high on the national agenda.
The Energy Chamber recently released a six-point plan which we believe is critical to achieve this.
Firstly, as a country, we need to fast-track bid rounds and the approval processes. The only way exploration and development is going to take place is if acreage is in the hands of competent and motivated companies.
We also need to focus on the issue of the reform of the upstream tax system to incentivise investment. Our Fiscal Reform Taskforce analysed the fiscal regime under which upstream companies operate in T&T and concluded that the current structure does not encourage companies to reinvest in exploration or in the development of new fields.
Thirdly, we need to promote investment to reduce the carbon intensity of both operations and products. In the future, cross-border adjustment mechanisms (or CBAMs) for carbon prices are likely to be introduced, particularly in Europe. This means that exporting will be dependent on the ability of operators to deliver low carbon products to market.
Fourthly, action is needed to divert natural gas from domestic electricity generation through energy efficiency and power generation from renewables. Doing this will free up natural gas which can be used in higher value activities like LNG and petrochemicals.
The fifth major area where we recommend action is in encouraging innovative approaches to small field development. We are a mature producer and new fields are often smaller and more difficult to develop. We need to find innovative ways of bringing this gas to market by making the best use of existing infrastructure.
The final area where we think action is needed is to secure cross and across-border gas supplies to be imported via pipeline. There are significant gas resources in neighbouring territories, especially in Venezuela, Barbados and Grenada. In addition to significant untapped offshore gas fields off Venezuela’s north coast, there are significant volumes of associated gas produced onshore Venezuela that is currently flared. The gas flared exceeds the current demand shortfall in Trinidad and Tobago.
Despite the challenges, T&T can position itself strategically in the energy transition and make the most of opportunities that are presented as the world shifts to a low carbon future. However, it is important to act now to ensure that our resources below the ground can be monetized as quickly as possible. Resources left in the ground have no value if not brought to market.
Extracted from the Who’s Who in Trinidad & Tobago in Business, 2022-2023 publication.