NGC profits fall 69 per cent, cites global challenges

The National Gas Company (NGC) has recorded a $396 million profit after tax for 2019, just under $2 billion lower – or 69 per cent – than what the state gas enterprise recorded in 2018.

In a statement Wednesday, NGC chairman Conrad Enill admitted that the energy sector faced several challenges in 2019. He added, though: “The NGC Group has learned well how to weather challenging times and cycles of change after 45 years of success in the energy business. However, you will find in those times of disruption, we have consistently forged opportunities for growth.”

The company noted external forces, including commodity price declines, including in the petrochemical sector, contributed to lower economic performance. Ammonia prices, for example, shrunk by 23 per cent, while methanol fell 31 per cent compared to 2018. Natural gas liquids (NGL) prices also were lower: propane and butane prices were 39.3 per cent and 36.6 per cent softer respectively than 2018, while natural gasoline was 5.9 per cent lower. At the same time, the company said, higher priced supplies delivered under new upstream gas purchase contracts resulted in an uptick in the weighted average cost of gas, further tightening sales margins. “Nevertheless, the group remains focused on the execution of its strategy and building a strong sustainable business,” Enill noted.

Securing and stabilising gas supply to sustain the petrochemical and downstream sector remains one of NGC’s core strategic pillars, the company said. In 2019, NGC successfully negotiated a fully termed domestic gas sales contract with Shell. It also signed a historic LNG agreement with China; its subsidiary, National Energy, opened an office in Guyana, and Phoenix Park Gas Processors Ltd (PPGPL) acquired NGL assets in the US. TTNGL, the holding company for PPGPL’s shares listed on the TT Stock Exchange has had steady performance, the company added, despite some price volatility over the last year.

On the clean energy front, the NGC CNG Co Ltd began construction of a flagship fuelling station at the Preysal Interchange. The group also lobbied for energy efficiency through the development of a national energy conservation and energy efficiency plant, now with Cabinet. It is also collaborating with the BP/Shell/Light Source consortium for the first major renewable energy project in TT. Prevailing conditions of the global energy sector did not crush NGC, the company said. “Though not spared from the negative effects of the worldwide lows in the energy sector, (NGC) has persevered and achieved transformative growth,” Enill said.