At­lantic is ad­mit­ting that "un­prece­dent­ed lev­els of gas short­falls through­out 2015 and low­er LNG prices have re­sult­ed in a sig­nif­i­cant de­cline in rev­enues," but the com­pa­ny is say­ing it re­mains con­fi­dent in the long-term out­look for the LNG busi­ness.

Re­spond­ing to ques­tions from the GML En­ter­prise Desk, At­lantic's me­dia com­mu­ni­ca­tions man­ag­er, Bill­son Hains­ley, said: "This coun­try has a world-class LNG fa­cil­i­ty and a strong in­ter­na­tion­al rep­u­ta­tion for be­ing one of the safest, most re­li­able LNG pro­duc­ers glob­al­ly."

In the past year, there has been a de­cline in LNG pro­duc­tion as a re­sult of a de­cline in nat­ur­al gas pro­duc­tion. At­lantic said it is now "en­cour­aged that dis­cus­sions be­tween the gov­ern­ments of Venezuela and T&T to com­mer­cialise the Lo­ran/Man­a­tee gas field have been pro­gress­ing."

The fields are said to con­tain 10 tril­lion cu­bic feet of nat­ur­al gas. Hains­ley added: "With in­fra­struc­ture al­ready in place, and in close prox­im­i­ty, the quick­est and most eco­nom­i­cal way to de­vel­op these re­serves–to the mu­tu­al ben­e­fit of both coun­tries–is via Trinidad."

As part of the com­mer­cial­i­sa­tion of the fields, he said: "At­lantic would be pleased to of­fer an LNG op­por­tu­ni­ty through its fa­cil­i­ties."

In late Oc­to­ber 2015, the Busi­ness Guardian re­port­ed ex­clu­sive­ly that the Venezue­lan gov­ern­ment had agreed to send some of its por­tion of the nat­ur­al gas in the Lo­ran/Man­a­tee cross-bor­der field to T&T to be processed as liq­ue­fied nat­ur­al gas (LNG).

Prime Min­is­ter Dr Kei­th Row­ley told the coun­try in late De­cem­ber in his State of the Econ­o­my ad­dress that his Gov­ern­ment had ex­ten­sive dis­cus­sions with the au­thor­i­ties in Cara­cas about "pro­duc­ing gas from the Lo­ran/Man­a­tee field which strad­dles our com­mon bor­der."

Dr Row­ley said he had re­ceived an in­vi­ta­tion from Pres­i­dent Maduro to vis­it Cara­cas "in the con­text of the dis­cus­sions which have been tak­ing place through our tech­ni­cal teams. I pro­pose to join him as soon as the tech­ni­cal work had ad­vanced a lit­tle fur­ther so that spe­cif­ic com­mit­ments can be made and ex­e­cut­ed."

At­lantic is the sixth largest LNG ex­porter in the world. It was in­cor­po­rat­ed in 1995 to de­vel­op a nat­ur­al gas liq­ue­fac­tion plant in Point Fortin. The first train of the plant came in­to pro­duc­tion in 1999 with the first ship­ment go­ing to Boston in May 1999. Over the en­su­ing years, the com­pa­ny ex­pand­ed. By 2005, the fourth train came in­to pro­duc­tion. At­lantic now has a stat­ed pro­duc­tion ca­pac­i­ty of 15 mil­lion met­ric tonnes per an­num.

The Unit­ed States once ac­count­ed for 80 per cent of LNG ex­ports but, to­day, it is sell­ing its own hy­dro­car­bons. Che­niere En­er­gy In­cor­po­ra­tion was ex­pect­ed to be­gin pro­duc­tion of LNG this month at the Sabine Pass Ter­mi­nal in Louisiana. This LNG would be ex­port­ed to Lithua­nia and West­ern Eu­rope.

But Hains­ley said while the US de­ci­sion to per­mit LNG ex­ports "will re­sult in an in­crease in the glob­al sup­ply of LNG, it will not have a ma­te­r­i­al im­pact on T&T's At­lantic ex­ports."

He ex­plained: "At­lantic's LNG vol­umes are sold un­der long-term con­tracts and this, cou­pled with At­lantic's sig­nif­i­cant­ly low­er de­vel­op­ment costs, will al­low our vol­umes to con­tin­ue to com­pete favourably in glob­al mar­kets against oth­er LNG sup­ply sources, in­clud­ing from the US."

He not­ed that the At­lantic LNG trains were built at "a frac­tion of the cost of new LNG fa­cil­i­ties com­ing on stream, on av­er­age, five to sev­en times cheap­er than the new plants be­ing built." As a re­sult, "Trinidad's LNG has a strong com­pet­i­tive ad­van­tage against many LNG sources."

Cur­rent­ly, the com­pa­ny's com­mer­cial con­tracts con­tain a high de­gree of des­ti­na­tion flex­i­bil­i­ty and Hains­ley said they work dili­gent­ly with LNG buy­ers to "iden­ti­fy op­por­tu­ni­ties to place its car­goes in the high­est priced mar­kets avail­able, to max­imise rev­enues."

Since 2008, Hains­ley said the amount of At­lantic LNG vol­umes be­ing sold to South Amer­i­ca has in­creased from one per cent to 51 per cent, tak­ing ad­van­tage of the com­par­a­tive bet­ter prices in South Amer­i­ca.

At­lantic, he said, re­mains con­fi­dent that "de­mand and prices will pick up from cur­rent low lev­els." That con­fi­dence is strength­ened be­cause "gas is in­creas­ing­ly the fos­sil fu­el of choice–be­ing clean­er than coal and oil–which is im­por­tant giv­en the need for im­proved world­wide stew­ard­ship."

This growth in the rel­a­tive im­por­tance of gas in the en­er­gy mix, ac­cord­ing to Hains­ley, will con­tin­ue to sup­port glob­al LNG de­mand, which is pro­ject­ed to grow by around five per cent per an­num over the next decade.

In ad­di­tion, At­lantic is of the view that many of the pro­posed new LNG sup­ply projects will be de­layed or can­celled in to­day's price en­vi­ron­ment.

T&T, in ad­di­tion to hav­ing built its plants at a frac­tion of the cost of new LNG fa­cil­i­ties com­ing on stream, is al­so viewed as hav­ing a world-class fa­cil­i­ty, strong ex­pe­ri­ence in LNG.

Ac­cord­ing to Hains­ley, At­lantic boasts is an "ex­cel­lent safe­ty record hav­ing ex­ceed­ed 30 mil­lion man hours with­out a lost time in­ci­dent.

"This coun­try al­so boasts an ex­cep­tion­al­ly high re­li­a­bil­i­ty rates av­er­ag­ing over 98 per cent.

Hains­ley said this helps to pro­mote Trinidad's sta­tus in the en­er­gy busi­ness in­ter­na­tion­al­ly.

For­mer en­er­gy min­is­ter Kevin Ram­nar­ine told the GML En­ter­prise Desk that "T&T re­mains a com­pet­i­tive play­er in the in­dus­try."

Ram­nar­ine added, "While there had been some ero­sion of our com­pet­i­tive po­si­tion due to the abun­dance of shale gas in the USA, and the fact that we have been run­ning short of nat­ur­al gas by about 10 per cent in the last five years, gen­er­al­ly, we re­main com­pet­i­tive."

He agreed that T&T's LNG in­dus­try would re­main more com­pet­i­tive, giv­en that liq­ue­fac­tion costs are among the low­est in the world and the four trains in Point Fortin are very ef­fi­cient and re­li­able com­pared to what ob­tains else­where.

Ram­nar­ine is, how­ev­er, con­cerned that once Che­niere En­er­gy be­gins ex­port­ing from its Louisiana USA ter­mi­nal, it would in­crease the glob­al sup­ply of LNG which may de­press prices.

But Hains­ley said, "Cur­rent pro­jec­tions of fore­cast­ed mar­ket prices in the dif­fer­ent re­gions do not in­di­cate that prices will be sig­nif­i­cant­ly im­pact­ed by the in­tro­duc­tion of the US LNG ca­pac­i­ty." Adding, "the com­mod­i­ty pric­ing is cycli­cal and will re­cov­er from cur­rent low lev­els."

Hains­ley said while At­lantic must "re­spond ap­pro­pri­ate­ly to chang­ing dy­nam­ics, it is al­so im­por­tant not to over­re­act to a sud­den sharp down­turn." He said LNG is a long-term busi­ness–40 years plus–and At­lantic con­tin­ues to in­vest in the LNG busi­ness for the longer term.

What is im­por­tant, Hains­ley said, is that "glob­al rep­u­ta­tion is main­tained and that T&T does not be­come an un­re­li­able LNG ex­porter like some oth­er coun­tries have."