Ramps CEO optimistic about forex future due to natural gas

Despite the continued decline in the availability of foreign exchange, Ramps Logistics CEO Shaun Rampersad is very optimistic about the country’s economic future.

He spoke at the private sector session on forex matters at the TT Chamber of Industry and Commerce, Westmoorings, on February 17.

Rampersad said the materialisation of the Manatee gas project will provide a significant boost in foreign exchange availability by 2027.

“It is going to get better by about 2027,” he said.

“We will see significant improvement in the actual supply of foreign exchange in the industry. (Oil and gas) production is going to increase significantly, the flow will improve and you will get access to more foreign exchange.

“We’ve had a lot of foreign exchange for a long, long time. We haven’t had it recently because of the production level, but when production comes back up in 2027 we will also have a significant increase in foreign exchange.”

UWI economist Dr Vaalmikki Arjoon shared similar sentiments despite the scepticism of some of his colleagues about the Manatee and Dragon projects, especially the Dragon deal. They will both supply natural gas from Venezuela to TT by 2027.

“My perspective is that there is still a 50-50 chance we can benefit from this. But when I hear some of my colleagues talk about Dragon gas, you would swear it is the worst thing for us. Putting aside the geopolitical issues, we need to be concerned about our energy security and foreign exchange needs.

“The Dragon field already has established infrastructure, so from an economic standpoint it makes sense to acquire gas from Dragon. Given the proximity to the Hibiscus platform, it makes sense to acquire gas from Dragon. And it’s not just natural gas we’re looking at. There's a healthy degree of natural gas liquids that we can acquire. So we’re looking at gas and liquids that we can profit from.

“Now granted, in the grand scheme of things it is just one piece of the overall energy equation for TT but the bulk of our forex comes from energy exports. At peak production, Dragon will be about 375 million stocks (MMcfd) per day. We’re going to get far more than that from Manatee. So, I really think we should not be ignoring the prospects of benefitting from Dragon.”

Shell Trinidad, which operates the Manatee field, installed a platform with eight development wells to be connected via a pipeline to its gas processing facility in Beachfield, Guayaguayare then to Atlantic LNG facility in Point Fortin, and NGC in Pt Lisas for production in the domestic gas market.

Despite the optimism, Rampersad warned that the years leading up to the development of these projects will prove to be difficult economically.

“Bad news is it’s going to get worse before it gets better. This year is going to be a very tough year. Next year, till about quarter three, it will be a very difficult year.

“So, I think the question we need to ask ourselves is not necessarily just about the flow but what are the lessons that we are learning from this period of difficulty in accessing foreign exchange.

“How are we building our businesses in a more resolute manner, so that when things get better we will benefit from it, but over a long period, over the next generation of entrepreneurs in this country. What are the lessons that we will learn from the last five years to build more resilient business going forward?

He encouraged businesses to take advantage of online platforms like Amazon to market and distribute their products.

“It’s going to be difficult, it’s going to be uncomfortable but we are going to get past it.”