Young: T&T and Venezuela a 'perfect relationship'
T&T and Venezuela make a perfect pair when it comes to the global energy stage, Energy Minister Stuart Young believes.
And because of this Young made several visits to Washington DC last year to discuss the removal of sanctions placed by the United States.
"I made six or eight trips to Washington DC last year and they were at various levels throughout Washington DC including at the highest levels. We in T&T have taken a position and we have always held the position to follow the UN charter on the principle of non-intervention, non-interference," Young said.
"We have maintained very good relationships with the government in Venezuela. President Maduro is still the president of Venezuela which is what we have been saying from day one," he said.
The United States, during the Trump administration, had placed strict economic sanctions on the Maduro-led Venezuelan government in 2019 because it claimed the government was suppressing human rights in the country.
Young said while many other countries adopted similar positions to the US, the T&T government held steadfast in its handling of the situation.
"We continue to have that relationship because whether people want to open their eyes to it or not Venezuela has the largest oil reserves in the world and they have significant gas reserves," Young said.
"T&T has significant assets and infrastructure here at Pt Lisas and in Pt Fortin that convert gas to global commodities, that you can monetise, ammonia, methanol, urea, UAN, LNG so we have that capacity. So it is a perfect relationship," Young said.
Young said T&T and Venezuela have been friends for years because of where we are positioned.
"So there is that continuing relationship. As the population would have seen I made a number of trips last year to Caracas as well meeting with President Maduro, on some of those occasions and we continue to be in constant contact as we are in Washington DC at the highest levels," Young said.
Those visits seemed to have paid off.
On Tuesday Prime Minister Dr Keith Rowley announced that the United States Government had approved T&T’s development of the Dragon Field via an OFAC Waiver from sanctions with specific terms to be finalised.
This means that the restrictions on the Dragon Gas Field development are now relieved and all relevant parties can progress the plans to result in natural gas from Venezuela.
Young spoke to the Business Guardian in a sit-down interview at his office located on the 26th floor at Tower C, of the International Waterfront Centre, Port-of-Spain.
From Young’s office, you can look out at the horizon of the Gulf of Paria.
But it was the type of energy future that T&T has on the horizon, that occupied Young’s mind.
“2023 is going to be an exciting year. My focus with the Ministry of Energy is to get the negotiations of the deepwater bids done with BP and Shell who have put in some bids on the deepwater because that is the next province for us,” he said.
Young said his goal is also to ensure that the ongoing bid round is handled smoothly.
On July 8 last year the Petroleum Regulations (Onshore and Nearshore Bidding) Order was published in the Gazette, signalling the start of the 2022 Onshore and Nearshore Competitive Bid Round.
A total of 11 blocks were made available for bidding including Aripero, Buenos Ayres, Charuma, Cipero, Cory D, Cory F, Guayaguayare, South West Peninsula Onshore, South West Peninsula Offshore, St. Mary’s and Tulsa.
Earlier this month 16 bids were received. The successful bids will be announced in three months.
The ministry is planning its Shallow Water Competitive Bid Round, which is expected to be launched within the first quarter of this year. Over twenty blocks are available for inclusion in this bid round.
Young said he also intends to “continue pushing Heritage and other persons who are onshore producers on the oil side” to continue working with the National Gas Company.
“We are going to have to have conversations this year with the downstreamers, meaning the pet chem companies, to make sure that there are gas contracts going forward in the future so there is a lot still going on. And also to continue to promote T&T,” Young said.
“So 2023 is going to continue to have a lot of activity, a lot of what we worked on will start coming in but we just have to keep pushing and I am also going to be looking at the fiscal for in particular oil and gas production to see how we may be able to tweak it to improve it to get more investment,” he said.
Young said he was still confident that the decision to shut down the refinery operations of Petrotrin was the right one
“I personally am a hard taskmaster so we are always pushing to get the best for the people of T&T, there are always improvements to be made I do think the restructuring of Petrotrin was a success as you have Heritage completely focused on the Exploration and Production,” he said.
The gas formula
With the high volatility with respect to global energy prices in recent times, Young said to try and counteract this T&T has instituted a new pricing formula for gas that will help spread our risk.
“The energy sector is very volatile and you are seeing that, so you saw prices years ago as low as US$180 metric tonnes for ammonia, last year it went up to US$1500 a metric tonne. Today it is just hovering around US$1,000 a metric tonne. You are seeing the same thing with the Henry Hub Price of gas,” Young said.
“One of the things we are particularly proud of is on the gas side we negotiated a formula for our gas so we have a mixture of JKM (Japan/Korea Marker) so that gives us some Asian market exposure and we have just negotiated between NBP (National Balancing Point) and TTF (Title Transfer Facility) which are two European markers,” he said.
“That is an excellent formula for us because you get the benefits of spreading your risk and people will see that all of those have brought higher prices for our gas in T&T than just being pegged on Henry Hub,” he said.
Young on second anniversary in Energy Ministry
April 19 marks exactly two years since Young was appointed this country’s Minister of Energy and Energy Industries following the untimely death of Franklin Khan.
Khan had held the position of Energy Minister since 2016.
Young said having worked with Khan during that period he feels his transition to the Energy Ministry had been seamless.
“It’s been seamless because I was assisting the previous ministers of energy since 2016 and had a particularly close working relationship with minister Khan and all of the big negotiations in the Energy sector that the government has been involved in since 2016, I have also been involved in so it was a very seamless transition,” Young said.
While Young declined to rate his own performance as Energy Minister, he believes he has done well so far.
“Of course being the substantive minister of energy you focus a lot more on energy and getting things done but I think it has gone well certainly from my perspective but I guess if you ask the energy stakeholders for their views they will give you their views,” Young said.
“I never grade myself, that is really for the stakeholders to do. I have done the best that I can and I have worked very closely, with the relationships in the sector but also spent a lot of time last year outside promoting T&T globally and hopefully the benefits of that will come home to roost,” he said.
A look back at 2022
“I think the biggest thing we have achieved as the government of T&T since 2015 to now is the renegotiation of the price formula and structures both on the LNG side as well as standing with NGC, in how they price and the price formulas that they use for their sale of gas because I can say without fear of contradiction that all of those have lead to material and tangible benefits for the people of T&T,” Young said.
“My strong belief is the resources are ours, meaning as citizens of T&T the prime minister mandated let us get better, more favourable and more equitable returns for T&T whilst balancing it with keeping foreign investment in T&T and I think we have successfully achieved that despite a lot of naysayers telling us at different times that we are going to destroy the industry, that foreign investment is going to dry up we have seen the exact opposite over the passage of time and we were always just focused on it,” he said.
Young also hailed the separation of the Loran-Manatee gas field and T&T being a fertile land for investment.
“We’ve pulled off a new PSC (production sharing contract) for Manatee, we’ve delinked the Loran side from Loran-Manatee, we’ve gotten bp to continue investing in T&T, Shell is invested heavily in T&T, we’ve kept EOG here, we’ve just managed the Woodside transition when they bought over BHP because you have to understand, Trinidadians have to understand when that takes place and have new management, new owners they look at their asset base, their global asset base and they can decide okay well T&T is no longer going to be a part of this asset base that we have purchased and they sell it off or they just drop it,” he said.
The renewables balancing act
Young said T&T needs to strike the right balance with the energy transition.
“A hydrocarbon-based economy is going to continue using hydrocarbons and we did not want the use of hydrocarbons to be drowned out in the conversation of the energy transition,” Young said.
“Gas is going to be around for decades to come, gas is the cleanest source of fossil fuel so we made sure to get out there speak to the right audiences, speak to the right people, and I think that has worked and people are focused on the continued production of oil and gas in particular with T&T can do for energy security,” he said.
“Of course, you have to have renewables so I am balancing that because we also are aware of the deleterious effects of the global climate change and I am particularly focused on that but you must have a balance because nobody can depend on solely on renewables,” he said.
Young said T&T will therefore be focused on decarbonisation.
“We have already signed the methane pledge so we are trying to clean up methane which is actually more harmful than carbon dioxide and these are things we are doing but we are doing renewables as well,” he said.
“I am particularly proud that by the end of last year after a long set of negotiation, you have seen that we signed the agreement for the largest solar farms in the English-speaking Caricom 112.2 megawatts, project Lara,” Young said.
https://guardian.co.tt/business/young-t ... 23e1827995
