TT-Barbados row not affecting energy investment

THE MARITIME boundary dispute between Trinidad and Tobago and Barbados has so far failed to bring activities in TT’s energy sector to a halt. This was yesterday’s analysis from the British Foreign and Commonwealth Office (FCO) and the US Central Intelligence Agency (CIA).

Last week, Barbadian Attorney General Mia Mottley said her government would be writing major oil companies currently operating in waters covered by the 1990 TT-Venezuela Maritime Delimita-tion Treaty, to inform them that these waters were in dispute. In doing so, she admitted that maritime energy reserves and not fishing lay at the heart of the TT-Barbados dispute.  Opposition Leader Basdeo Panday condemned Barbados for trying to do irreparable harm to TT’s economy and said Mottley’s utterances proved a longstanding belief in several quarters that the bone of contention between the two countries was not fishing.

In its latest review of TT’s economy, the CIA said TT remains “an excellent investment site for international businesses” especially within the energy sector.  The CIA adds that there are no security concerns in TT at this time and business continues as usual in all sectors of the local economy. The British FCO also notes the tremendous growth potential of the local energy sector and continued activity of foreign and local companies in this sector. “Economically, Trinidad and Tobago is different from other Caribbean countries because of its oil and gas reserves. Gas is the fuel under-pinning world-class capacity in LNG, methanol and ammonia. British Petroleum (BP) and British Gas (BG) are major operators and investors in this substructure and BP’s latest find is the largest in the country’s history. Shell is also talking of a commercial gas-to-liquids plant.”

In February 2003, BP announced that it would invest $20 billion in production in five less traditional oil-producing areas one of which will be Trinidad and Tobago. There is a positive outlook for international oil prices in 2003 that will benefit TT’s terms of trade. The energy sector is set to expand in 2003-04 with growth in production and exports, steady rise in oil production, and Foreign Direct Investment (FDI) in the expansion of the Atlantic LNG facility. With new operational facilities shoring up export capacity, and new investment supporting construction activity, real GDP growth is expected to jump to an annual average of 4.3 percent in 2003-04,” the FCO stated.