Congress of the People leader Carolyn Seepersad-Bachan says the Dragon gas deal between TT and Venezuela has been dead in the water ever since the political turmoil began in the South American country a year ago.
She was responding to the announcement by the Prime Minister at the energy conference on Monday that because of US sanctions, the Dragon deal was on hold and the Loran Manatee deal has been rescinded, with the two countries developing their fields independently.
“From the time the US sanctions started I said this would happen.” She said TT is also at risk of being blacklisted by the US for doing business with Venezuela.
She also said Government has not been open and transparent about the Dragon deal, and it was not clear how much capital costs had been incurred and by whom, whether the National Gas Company (NGC) or the State.
Seepersad-Bachan reiterated that instead of looking at Venezuela, which has a lot of political country risk, as a “game-changer,” Government should have been looking at aggressive exploration efforts in TT’s deepwater or shallow water area. “Government instead disincentivised work to be done upstream with investors in light of the competition globally.”
On Loran Manatee, she said the unitisation agreement was negotiated while she was energy minister and it was decided it was not economical on either side and it was better to have one common operator. She recalled in August 2010 the possibility of the southern coast being used as the area to support the service operators of Loran Manatee.
She said she was surprised to hear the Loran Manatee unitisation agreement was rescinded and she wanted to get more details, including on the delineation of the area.
UNC deputy leader David Lee said from the information the party has, both the Dragon and Loran Manatee deals are “dead.”
UNC: they cannot continue
“They cannot continue, given the whole issue of the political aspects (of Venezuela). Any gas situation in Venezuela is up in the air because of US sanctions. Where the Dragon gas deal or Loran Manatee is concerned, everything is literally on hold, to the point that nothing is going to happen.”
Lee stressed that until “something gives” in Venezuela, it was not prudent to put taxpayers at risk with whatever deal Government wants to make. He said there is still a cost involved and the public should know how much money has been expended on the TT side and whether by the NGC, Energy Ministry or any state companies.
He suggested that Government’s energies should be focused on Guyana, which has oil in abundance, and restarting the refinery.
He also said Dr Rowley has reported being involved in gas-price negotiations with upstream producers, which has resulted in downstream producers leaving and shutting down factories. “We have lost valuable foreign exchange, with companies shutting down at the Point Lisas Industrial Estate.”
MSJ NOT SURPRISED
Movement for Social Justice leader David Abdulah said Rowley’s announcement was not surprising because of the US sanctions and challenges posed for Venezuela in general, and state company PDVSA in particular. “PDVSA has been very hard hit.”
Abdulah said the party believes the sanctions to be “totally illegal” and unilaterally imposed, contrary to international norms and requirements. “It is the US strategy for regime change which is wrong.” He said it was not surprising that because of this situation the Dragon gas project cannot proceed.
“Companies cannot easily do business, with PDVSA’s sanctions, and PDVSA is cash-strapped.” Asked whether Government should continue to pursue the Dragon deal, Abdulah said there are major agreements signed between TT and Venezuela which are still valid and still hold.
“We will have to see what transpires politically in Venezuela and the US position, which is illegal. It just postpones what eventually will have to happen with Dragon gas. I do not know how long it will take for the process to be resumed.”He said as Dragon gas will not be available for some time, this will have implications for gas supply to downstream users of gas. “I wanted to hear how Government was going to deal with the current forecast shortage of gas, where demand is greater than supply of gas. This needs to be addressed.”