– Prime Minister says that nation deserves more than crumbs
“It is our view that there is a role for the government in ensuring that the people of Trinidad and Tobago, while being participants in this very lucrative business, get more than crumbs that fall off the table.”
Those were the words of Prime Minister of the twin-island Republic, Dr. Keith Rowley, during a passionate presentation at the Hyatt Regency Hotel, Port of Spain. He was at the time, delivering the feature address at a forum called—Spotlight on Energy.
He said that the main purpose behind the conference was to allow the people of Trinidad and Tobago to know of their circumstance in the oil and gas industry so as to be able to determine and to protect their interest.
Dr. Rowley focused on the need for his nation to get a fair share of the oil pie. And in order for this to happen, the Government of Trinidad and Tobago has started the process of reopening and renegotiating contracts. He emphasized that Trinidad and Tobago’s current economic situation is a wakeup call for all.
He pointed to a book called “Seven Elements that Changed the World”. It was written by Sir John Browne, former head of British Petroleum (BP), one of the world’s leading integrated oil and gas companies.
Rowley said that Sir John talks about the seven things that changed the world, with natural gas being one of them.
The Prime Minister said, “We used to be a country that used to flare natural gas. Then we started to compress it and use it as a raw material and it started with one fertiliser plant.
“So when Sir John wrote about the seven things that changed the world, and God knows how the world has been changed by natural gas, he said in 2004, ‘Trinidad contained some of the jewels that BP recently acquired in its merger with AMOCO.
“And I was there to ensure BP’s growth in the region would continue. BP has made several major discoveries in the late 1990’s and early 2000’s including the first one in Trinidad’s deep water.’ and it goes on to say, ‘Patrick Manning wanted to ensure that this latest find of natural gas would be used for his people’s benefit.”
Rowley continued, “If nobody understood that, Sir John Browne understood that. And that is why, when we see the data today that Trinidad and Tobago is not benefitting as we should from our natural gas resources, in the way that it was envisaged that we would, in hard times and in good times, then certainly the people of this country should sit up and take notice.”
Rowley said that the one thing the Government knows it must do is to sit down and talk with the companies that are involved about getting a fairer share “because we have incentivized ourselves into leakages and losses.”
The Prime Minister continued, “You know, the word incentive has been overused in Trinidad and Tobago. If you have something that is not going right, and somebody tells you it is because of an absence of incentive – well, we have given so many incentives, that at the end of the day, we are so attractive that the incentives, in some instances, mean that we are giving away the shop.”
Rowley, “And of course, it can be presented to us in very logical and impressive arguments that had we not granted those incentives and if we don’t give these incentives, they will walk away from us and not invest in our country and we will all starve.
“But, when we reach the point where we bring up gas, produce it, sell it in a market where profits are being made and the return is negative – meaning you get nothing, you have to pay the person to take it from you – something is radically wrong and we just can’t accept that as the way of doing business.”
The Prime Minister noted that a decade ago, Trinidad and Tobago earned $20B in revenues from oil and gas. That dropped to $1B last year. He believes that the primary cause of this is that the country has over-incentivized the industry, a practice that Guyana is already engaging in.
“If there is no profit being declared, then there is no petroleum profit tax to be had…we anticipate that there will be some reopening of contracts so that at the end of the day, we can all sustainably benefit from the god-given riches of Trinidad and Tobago.”
Dr. Rowley revealed, too, that some renegotiations have already started. He noted that the National Gas Company of Trinidad and Tobago and Caribbean Nitrogen Company Limited have agreed to new arrangements. He revealed that so far, there has been a willingness on the part of energy companies to treat contracts in a flexible manner.
Click on this link to see more of Prime Minister Keith Rowley’s criticisms of the oil and gas industry and existing contracts: https://www.youtube.com/watch?v=ATq-R03MFq0
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