Khan: TT has 10 more years of gas

AT the current rate of consumption, TT has ten-11 years of natural gas deposits left, Energy Minister Franklin Khan said at yesterday’s presentation of the 2018 Ryder Scott Report at his waterfront office in Port of Spain.

However, he warned against any simplistic interpretation of such data,saying gas numbers, such as consumption and reserves, are not static figures that can be measured as if one is emptying a bucket, but also involved a replenishment of gas.

“We have had ten-15 years over the last 20 years,” he remarked.

The event revealed a rise in both TT’s gas reserves and gas extraction/production.

Khan said while extraction/production of gas last year had not quite met its target, nonetheless TT was still in “a better place” than previously.

He said last year, some 1.1 trillion cubic feet (tcf) of gas extracted from the proven (or confirmed) reserves had been replenished by 1.7 tcf of new finds, taking the proved gas total from 9.9 to 10.5 tcf.

Expressing confidence that depleting gas reserves could be replenished, he said, “We have some of the best E&P (exploration and production) operators in TT.”

Khan said to replenish depleting reserves, TT needs to find the equivalent of a Juniper or Angelin field every year, which was no mean feat.

Asked if more exploration incentives were needed, Khan said upstream companies had not asked him for that, saying current terms were attractive by international standards.

“I don’t think there’s any need for a fiscal overhaul at this point in time.”

However, he mulled concessions for small oil companies which face a steep curve when the supplemental petroleum tax kicks in at US$50 per barrel.

Khan said an audit of TT’s oil reserves up to 2018 should be completed in December by Netherland Sewell and Associates which had done TT’s last oil audit in 2012.

The preliminary results given to the ministry’s technical staff indicated “significant increases in our prospective resources due to deepwater oil leads identified in blocks operated by BHP.”

Khan said, “This bodes very well for future competitive bid rounds in our deepwater acreage.”

Replying to a query, Khan said a daily production of 4.0 bcf of gas would alleviate curtailment of supply to downstream users but at present it is 3.7-3.8 bcf.

“In 2022, hopefully, gas curtailment will be a thing of the past,” he said, anticipating gas from the Cassia, Macadamia and Barracuda fields.

Asked if a rise in gas production helps downstream industries (given the due year-end closure of the Yara ammonia plant at Savonetta due to failed gas-supply talks with the NGC), Khan said that plant was 50 years old, with a conversion ratio way beyond international norms and Yara’s own standards.

“The days of significantly cheap gas which TT could offer 20 years ago – those days are gone. You need efficient plants.

“We are glad NGC concluded contracts with CNC (Caribbean Nitrogen Company) and Nutrien.”

Khan said deep water gas finds had led to an astounding 34 per cent jump in TT’s exploration resources between 2016 and 2017.

He named deepwater successes as BHP’s Bongos, Victoria and Block 3a Ruby and Delaware discoveries.

“Exceptional performance from the latest wells drilled in the Shell Dolphin field was particularly significant as well.”