Beyond the Dragon deal

One of the biggest lessons we can take away from the pausing of the landmark cross-border agreement between TT and Venezuela is how our interests are inherently wrapped up with international politics. Prime Minister Dr Keith Rowley’s confirmation on Monday that US sanctions have had an impact on the prospect of the project going forward is not surprising. It should nonetheless deepen our resolve to insulate our economy from the whims of international developments through meaningful diversification.

Rowley, as well as Energy Minister Franklin Khan, appear optimistic that once sanctions are lifted it will be full steam ahead since virtually all of the preparatory work has been done. But such optimism puts much faith in the capacity of the main actors to resolve their differences within a reasonable timeframe. That’s not certain to happen.

Donald Trump has had no qualms in expressing his desire for regime change in Venezuela, while Nicolas Maduro has shown little sign of relaxing his dictatorship. With Americans due to vote later this year in presidential elections, Trump is likely to dig in on his “foreign policy” to galvanise support at home. And with so many unknown factors, particularly within the Democratic party after its Iowa fiasco, even assuming a change in the White House, it’s not clear what the position of the Oval Office will be after November 3. Perhaps these uncertainties make the fate of Dragon more tenuous than the Government would desire.

At the same time, it was not all bad news. Government will move forward with Manatee, part of the Loran-Manatee cross-border (shared field) with Venezuela. The field has just over ten trillion cubic feet of gas, with about 75 per cent in Venezuela and 25 per cent in TT. Rowley said Manatee was “the single most significant development in the energy sector in recent times.” He also boasted of close to a billion dollars in profits from the subsidiary companies of Trinidad Petroleum Holdings Ltd – Heritage Petroleum and Paria Fuel Trading companies. He said for its first year Heritage made $884 million in profits after tax (unaudited) and Paria garnered $172 million for the same period.

It will not escape many, however, that the matter of the impact of US sanctions on our own economic prospects might have been one matter which could have usefully been raised with US Secretary of State Mike Pompeo in his controversial visit to Jamaica at which he selectively invited some Caricom leaders, at the expense of others. The irony is that notwithstanding the region’s position of non-intervention in the impasse between the US and Venezuela, we’ve still paid a price.

This, then, is the face of sovereignty in the year 2020.

Still, there is some merit in turning to other regional partners, such as Guyana, for fresh collaborations. DeNovo managing director Joel “Monty” Pemberton last week noted the potential of such collaborations, possibly involving shared infrastructure, to maximise existing resources.

And yet, at a time when the world is turning away from the extraction of fossil fuels, there is also merit in going beyond the status quo and seeking to deepen our diversification, independent of the energy industry.