Faced with plant clo­sure due to the nat­ur­al gas short­ages and the need to keep its busi­ness run­ning in the long term, Pro­man Group in­vest­ed in the up­stream and will now be able to sup­ply 70 mil­lion stan­dard cu­bic feet a day of nat­ur­al gas through its Methanol Hold­ing plant in Point Lisas.

This is a sig­nif­i­cant achieve­ment, not in terms of the rel­a­tive­ly mod­est amount of gas to be pro­vid­ed by De Ne­vo En­er­gy, but it’s the first time that a lo­cal down­stream com­pa­ny has ven­tured up­stream and, in the process, has been able to se­cure some of the gas it needs to pow­er its plants.

More than that, through the sign­ing of a gas sales con­tract, the com­pa­ny has been able to con­vince the NGC that its gas must be re­served ex­clu­sive­ly for its use.

Pres­i­dent of the NGC Mark Lo­quan con­firmed to Busi­ness & Mon­ey that the arrange­ment is that De­N­o­vo’s gas will go to MHTL but it will pass through NGC’s pipelines.

This seems to square with what is con­tained in the gov­ern­ment’s bud­get doc­u­ment, State En­ter­prise In­vest­ment Pro­gramme 2019, that was re­cent­ly laid in the Par­lia­ment.

The bud­get doc­u­ment not­ed that the NGC will build a 20-inch di­am­e­ter pipeline from the out­let of the De­N­o­vo Gas Pro­cess­ing Unit, Point Lisas, which is cur­rent­ly un­der con­struc­tion, to the in­let of NGC’s Phoenix Park Valve Sta­tion.

It said the NGC has ini­ti­at­ed a desk­top study to iden­ti­fy con­cep­tu­al de­sign and rout­ing for the pro­posed pipeline. The es­ti­mat­ed cost of this project is $196.3 mil­lion with pro­ject­ed ex­pen­di­ture of $81.2 mil­lion for fis­cal 2019. In ad­di­tion, a pipeline will be con­struct­ed from De­N­o­vo’s Gas Pro­cess­ing Unit to MHTL .

The re­port read, “A 14-inch di­am­e­ter on­shore nat­ur­al gas pipeline run­ning from the fis­cal­i­sa­tion me­ter at the gas pro­cess­ing unit lo­cat­ed at the De No­vo En­er­gy Block 1A Ltd bat­tery lim­its to the gas in­let of the MHTL methanol fa­cil­i­ty is be­ing con­struct­ed. The line mea­sures ap­prox­i­mate­ly 3.4 kilo­me­ters and is ex­pect­ed to cost $28.8 mil­lion. The line is ex­pect­ed to be com­mis­sioned by the end of fis­cal 2018.”

The Na­tion­al Gas Com­pa­ny and De­N­o­vo En­er­gy Ltd (De­N­o­vo) re­cent­ly an­nounced that the two com­pa­nies had signed a Gas Sales Agree­ment (GSA) for the sale of nat­ur­al gas from De­N­o­vo’s Block 1(a) as­set to NGC.

NGC, through NGC E&P In­vest­ments Ltd (NGC E&P), owns 20 per cent of Block 1(a) through a joint ven­ture with De­N­o­vo who owns 80 per cent as the op­er­a­tor.

The GSA was signed in an­tic­i­pa­tion of De­N­o­vo’s de­liv­ery of nat­ur­al gas lat­er this year from the Igua­na field in Block 1(a), which is the first nat­ur­al gas de­vel­op­ment to take place in the Gulf of Paria, of Trinidad’s west coast. The agree­ment al­so brought a new up­stream play­er in­to the gas sup­ply stream as De­N­o­vo will be­come the 5th gas pro­duc­er in the coun­try.

The re­lease said, “This is in line with the strate­gic pri­or­i­ties of both com­pa­nies to in­crease nat­ur­al gas pro­duc­tion for use by the petro­chem­i­cal sec­tor in T&T by mon­etis­ing proven strand­ed nat­ur­al gas re­serves.

De­N­o­vo’s chief ex­ec­u­tive of­fi­cer, Joel “Mon­ty” Pem­ber­ton had de­scribed the deal as, “the per­fect ex­am­ple of pri­vate sec­tor in­dus­try and state col­lab­o­ra­tion, en­abling an in­no­v­a­tive res­o­lu­tion to the on­go­ing chal­lenge to ful­fil the nat­ur­al gas de­mand in our coun­try.”

Pem­ber­ton ex­plained, “De­N­o­vo is the first lo­cal up­stream com­pa­ny to op­er­ate an off­shore gas field, us­ing the best lo­cal ex­per­tise with rel­e­vant glob­al part­ner­ships in the de­vel­op­ment of our coun­try’s nat­ur­al gas re­sources. This was achieved through a strate­gic in­vest­ment by the Pro­man Group to con­tribute to T&T’s nat­ur­al gas sup­ply for the ben­e­fit of all stake­hold­ers.

In the past, bpTT through its part­ner­ship with Methanex has pro­vid­ed gas di­rect­ly to the down­stream and so to EOG in its part­ner­ship with the Pro­man Group al­so pro­vide gas to its in­vest­ment in am­mo­nia.