Business heads optimistic, economist cautious about BP investment

Indera Sagewan-Alli says BP may be signalling that a revision of the fiscal regime which governs the local energy sector is needed.

The Office of the Prime Minister, in a release on Thursday, stated that BP would invest US$5 billion in this country over the next five years. The release also stated that the final agreement between the National Gas Company and BP for Angelin gas field, which is 40 kilometres offshore Trinidad and Tobago’s east coast, “will be executed shortly and that this project will be kept on schedule.” In a statement yesterday, Energy Chamber chief executive officer Dr. Thackwray Driver said the announcement that BPTT and NGC are close to a final agreement on a new gas supply contract post-2019 is “very positive news for the gas industry in Trinidad and Tobago.” “The finalisation of this agreement was needed before BPTT would proceed with their next major field development project, Angelin, and also opens the way for further investments. Given the urgent need for new investment in upstream gas production, this is therefore very welcome news for Trinidad & Tobago,” Driver stated.

In full agreement was newly elected president of the Chaguanas Chamber of Industry and Commerce (CCIC) Vishnu Charran who, in an interview, said the company was seeing “growth and potential in our economy.” “They are seeing stability despite all the negative reports we see in the papers,” Charran said.

“They see stability in government and the ease of doing business with the government so it is a good sign for the economy.” However Sagewan-Alli recalled that BP had previously said the company was “prepared to make that level of investment in Trinidad and Tobago provided the economic climate was conducive to that kind of investment.” “And what he was alluding very clearly to was the issue of the fiscal regime within which BP operates and so he was sending a very clear message that unless the government is prepared to make that environment a lot more attractive that it currently is, the current economic climate in the energy environment, it is subject to that.

“Let us not forget that BP, over the last two years, has downsized, laid off quite a few hundred workers in Trinidad in its effort at rationalisation which has been its response to what is happening in the global energy market,” she said. Meanwhile, Driver, who recently attended an energy conference in Guyana, said there were “numerous” business opportunities available in the fledgling Guyanese oil industry.

“The continued exploration success of Exxon and their partners in Guyana highlights the potential that exists for the development of the oil industry in our Caribbean neighbour.”