UNC calls on government to improve investment climate

UNC MP and shadow minister for trade and industry Rushton Paray is calling on government to put measures in place to make TT’s investment climate more favourable for investors in deepwater exploration. He said one such measure is reducing the country’s percentage of profit-sharing agreements.

At an Opposition media conference on Thursday, Paray said TT’s investment environment is currently ranked as one of the worst in the world. He said it was alarming but not surprising that the Energy Minister would transmit a fixed position on all negotiation regarding Trinidad and Tobago’s take-home in any agreement going forward.

“Basically, he told potential investors – it’s his way or the highway! I wish to remind (Energy) Minister (Stuart) Young that TT is ranked second in the highest profit-sharing ratio among oil producing nations according to Rystad Energy. Capital is now being split three ways – continued investments in mature fields, investments in new and emerging fields with lower profit-sharing contracts and finally, investments in renewables.

“We reiterate that immediate attention must be paid to restructuring the energy investment conditions in order to place the sector on a sustainable growth path. It will be a trade-off of less revenue for the country but we are competing for capital with new and emerging fields, including in Guyana and Suriname, so it is urgent we move urgently and quickly.”

He said the decision of the Biden administration to grant a license for TT to develop the Dragon gas field in Venezuela’s territorial waters was welcomed.

“While the UNC is heartened at the approval for monetising the Dragon field, we note that the PNM Government is still bungling with respect to measures, to place the energy sector on a growth path. Monetising the Dragon gas field is at least four to five years away. In fact, bureaucratic, regulatory, and infrastructural work could take even longer. The Government cannot herald this decision as an overnight solution to TT’s low production output.

“We also want to restate the fact that Washington has not authorised the issuance of payments to Venezuela, and this could make it difficult, maybe even impractical, for TT to craft a commercial deal with Caracas. We are not amused by the Prime Ministers response to that very same question – he indicated that there are many ways to pay for the gas besides cash.

He called on the PM to explain what these ways were, as he said the UNC was sure that any alternative forms of payment besides bartering would require legislative and regulatory changes which should start today.

“In addition, the United States Office of Foreign Assets Control has not lifted other relevant restrictions and sanctions against Venezuela.”

Paray said the two billion cubic feet shortfall in gas could not be filled in the short or medium term.

“…unless there is some sort of miraculous efficiencies in using the gas or there’s an ability to bring in feed stock via gas or ship, which may be impractical at this time. A progressive government ought to act immediately to improve the investment climate, to ask those players who are sitting on the verges of the Stabroek field out of Guyana, to look at our deep waters, get them here, get their $20 or$30 billion in investment in the TT economy immediately.”