Former energy minister Kevin Ramnarine has called for urgent action to be taken at Point Lisas Industrial Estate to prevent it from crashing and causing a major energy and economic crisis in TT.
His comments came after another Nutrien plant was shuttered in a little over one month and will continue to remain down amid declines in the global market price of ammonia.
The plant, on the Point Lisas Industrial Estate, was initially shut down on June 12 for maintenance work to be carried out. The work has been completed but the plant will remain down for another 14 days.
Nutrien Trinidad managing director Ian Walcott confirmed on Friday that they are monitoring the global market price of ammonia and this will determine the company’s next move. He added that this development will have no effect on its current workforce. Last month, PCS 02 was also shuttered due to economic challenges.
Ramnarine said on Friday this latest development is a cause for concern as this was the fifth plant to be shut down or idled in the past six months.
He said a recent statement made by Energy Minister Franklin Khan in Parliament on revisiting agreements with the National Gas Company (NGC) and its upstream suppliers showed something is not right.
He said, “His admission showed that something went fundamentally wrong back in 2017 because the price of natural gas that these plants now have to pay to the NGC has significantly increased in the last 18 months.
“This is a consequence of no agreement between the NGC and its upstream suppliers. We are now seeing the impact of those negotiations manifesting itself in a weakening of Point Lisas.”
Ramnarine added that more plants will eventually be taken down if Government refuses to address the cost of producing ammonia and methanol.
He said, “When these plants close there will to be consequences for employment. Even if the plants can hold their permanent staff together, there are always going to be consequences for contractors and energy service companies.
“As a result of Government’s flawed contracts, Nutrien’s reaction to the low ammonia prices and the high cost that they are paying for natural gas, now renders their operations unprofitable.
“We now have to wait and see if they will re-start the plant. The other plants that have been idled have been down for months.”
A recent International Commodity Information Service (ICIS) report said price would remain "bearish" in June, quoting a US$218 per tonne estimate. Prices are falling due to an oversupply, and ICIS said that " only Nutrien, to date, has announced capacity cuts in response to the significant surplus volume."
"The Canadian major's decision to remove 50,000 tonnes/month of export volume from Trinidad came shortly before Ukrainian producers switched their attention to foreign sales amid cheaper natural gas prices," icis.com reported.
Editor's note: This story was amended on June 22 to correct an error in the name of Nutrien's managing director.