The Energy Chamber has underscored the importance of negotiations, especially in the energy sector as it eagerly anticipates the Ministry of Finance’s mid-year review of the economy.
Chamber president Dr Thackwray Driver, in a media release, stated the chamber is “looking forward to hearing more information about revenue that has been received from the oil and gas industry this financial year. “
The chamber described recent reports that Government and multinational energy giant bpTT have settled a past revenue claim for $1 billion as "excellent", saying this “underlines the importance of dialogue and negotiation”.
“The Energy Chamber warmly welcomes the news concerning the establishment of empowered negotiating committees, coming out the Prime Minister’s recent visits to London. We look forward to hearing further news from these negotiations, concerning the future of the LNG industry, in due course. These negotiations are extremely important for the future of the country and it is positive news that they are receiving such high priority,” the chamber stated.
The chamber also noted that while oil and gas prices have trended upwards over the last few months, it “remains to be seen how this increase in price translates into actual revenue receipts. It should be noted that supplemental petroleum tax is paid on oil production only and that Petrotrin is the major oil producer.”
The chamber highlighted that the Minister of Finance Colm Imbert had previously reported about “challenges” which Government has encountered in receiving tax and other revenue from Petrotrin.
That observation was recently reinforced by Energy Minister Franklin Khan, who at an energy forum in March stated that Petrotrin, which produces approximately 60 per cent of the country’s crude oil, has been “withholding payment due to its financial challenges and other financial obligations”.
“As at December 31, 2017, the company owed Government $2 billion in taxes and royalties. With current prices averaging US$60 per barrel, the debt continues to accrue at $70 million per month without any indication by Petrotrin of any forthcoming payment. Obviously, this is an unacceptable position which the board of directors has been requested to address,” Khan had stated.