T&T Pa­tri­ot

The 2026 fis­cal year was an aw­ful pe­ri­od for the down­stream petro­chem­i­cal sec­tor in Trinidad and To­ba­go (T&T). Con­tract ne­go­ti­a­tions for new gas con­tracts led to the idling of the Nu­trien fa­cil­i­ties, which was fol­lowed by the idling of the Methanex Ti­tan fa­cil­i­ty. Re­cent­ly, Pro­man took the dif­fi­cult de­ci­sion to re­struc­ture its busi­ness to ad­dress the re­al­i­ty of the nat­ur­al gas sup­ply sit­u­a­tion. Over the last year, the petro­chem­i­cal sec­tor shed more than 450 di­rect jobs and like­ly close to 450 in­di­rect jobs. This doesn’t in­clude any job loss from the Pro­man re­struc­tur­ing. The sit­u­a­tion al­so had a tremen­dous neg­a­tive im­pact on en­er­gy ser­vices con­trac­tors, as op­er­a­tors ad­just­ed their main­te­nance pro­grammes in re­sponse to their ex­is­ten­tial sit­u­a­tion.

Truth be told, the oth­er Point Lisas op­er­a­tors, ex­clud­ing Methanex and Nu­trien, re­luc­tant­ly ac­cept­ed the terms of the one-year NGC gas con­tracts, hop­ing for some­thing bet­ter when the con­tracts came up for re­new­al in Jan­u­ary of 2027. Re­call that in 2017, the nat­ur­al gas con­tracts were five years, which al­lowed for plan­ning ma­jor main­te­nance. In 2022, the term was three years, which cre­at­ed great un­ease and then de­grad­ed to one-year con­tracts in late 2025/ear­ly 2026.

The time has come for the petro­chem­i­cal in­dus­try to meet with the NGC and be­gin ne­go­ti­a­tions for new gas con­tracts. There is con­fi­dence that the NGC is work­ing very hard to of­fer a bet­ter deal for the down­stream petro­chem­i­cal in­dus­try.

An in­dus­try stal­wart on the NGC board al­so chairs At­lantic and has more than 40 years of ex­pe­ri­ence in the down­stream petro­chem­i­cal sec­tor. The NGC Chair­man, a neo­phyte in this sec­tor, should wel­come the ad­vice of this high­ly ex­pe­ri­enced board mem­ber, and T&T should ex­pect bet­ter out­comes from the 2027 gas con­tract ne­go­ti­a­tions.

It would be an ab­solute dis­as­ter for T&T to have fur­ther an­nounce­ments in 2027 of ad­di­tion­al op­er­a­tors idling fa­cil­i­ties. The very pos­i­tive 2026 an­nounce­ments on fu­ture nat­ur­al gas sup­ply can ma­te­ri­al­ly im­prove the terms of an NGC nat­ur­al gas down­stream con­tract, and it helps to men­tion them in plain lan­guage.

Light at end of the tun­nel

Most cit­i­zens fa­mil­iar with the en­er­gy sec­tor will con­clude that pos­i­tive an­nounce­ments about prospects that can boost Trinidad and To­ba­go’s nat­ur­al gas sup­ply have steadi­ly flowed, giv­en the in­ex­orable de­cline since 2014 from 4,200 MM­scfd to a 2026 Jan to June dai­ly av­er­age of 2,500 MM­scfd. The ta­ble be­low lists an­nounced prospects that have re­ceived full in­vest­ment ap­proval or are soon to be con­sid­ered for a fi­nal in­vest­ment de­ci­sion, in­di­cat­ing that avail­able gas sup­ply will im­prove start­ing in 2027 and con­tin­ue up­ward in 2028 to an es­ti­mat­ed 3,400 MM­scfd. This fore­cast as­sumes a 15 per cent an­nu­al de­cline rate in ex­ist­ing pro­duc­tion. A pro­duc­tion plateau above 3,000 MM­scfd can be main­tained un­til cir­ca 2034, af­ter which de­cline can be sharp if new sources aren’t iden­ti­fied and de­vel­oped.

Choic­es

All good so far. We now turn to how these nat­ur­al gas prospects will be mon­e­tised. Shell and bpTT clear­ly favour mon­etis­ing through the LNG route, which ar­guably pro­vides the best val­ue for the gas they pro­duce. The NGC has pro­cess­ing ca­pac­i­ty at the LNG fa­cil­i­ties and has open­ly stat­ed that they have been mon­etis­ing gas as LNG, par­tic­u­lar­ly giv­en the re­cent high prices. This cer­tain­ly cre­ates a ten­sion with short­ing down­stream cus­tomers and di­vert­ing sup­ply to LNG. This may very well be per­mit­ted un­der ex­ist­ing sup­ply con­tracts, so there is no con­trac­tu­al is­sue. As­sum­ing Train 1 re­mains down, the pro­cess­ing ca­pac­i­ty of T2/T3 and T4 com­bined is cir­ca 1900-2000 MM­scfd. Down­stream de­mand in T&T for elec­tri­cal pow­er, am­mo­nia, methanol, steel, and light in­dus­tri­al con­sumers is cir­ca 1500 MM­scfd, as­sum­ing all plants are avail­able to run, based on 2019 MEEI da­ta when dai­ly pro­duc­tion av­er­aged 3,400 MM­scfd. There will clear­ly be enough gas for down­stream in T&T to run the plants that were op­er­a­tional in 2019.

Most fi­nan­cial ad­vi­sors would strong­ly ex­tol the ben­e­fits of a di­ver­si­fied in­vest­ment port­fo­lio. Stat­ed: Don’t put all your eggs in one bas­ket. T&T’s op­tions for mon­etis­ing its nat­ur­al gas are no dif­fer­ent. The fu­ture can be very dif­fer­ent from the past. As we saw with the huge price in­creas­es of nat­ur­al gas-de­rived com­modi­ties in 2022, dri­ven by the Rus­sia/Ukraine war, those prices re­turned to much low­er, nor­mal lev­els in 2024 and 2025. Com­mod­i­ty price out­look and the val­ue-add of pro­duc­ing and ex­port­ing are key fac­tors in de­ci­sions that max­imise val­ue for T&T over the long term.

LNG Prices

The years 2022 and 2026 were bo­nan­za years for LNG, with prices soar­ing. Look a lit­tle deep­er, and you will see that key in­sti­tu­tions like the In­ter­na­tion­al En­er­gy Agency (IEA) and well-re­spect­ed in­dus­try an­a­lysts pre­dict an LNG glut in the com­ing years.

On the sup­ply side, af­ter a strong 2.8 per cent in­crease in 2024, glob­al gas de­mand growth slowed sig­nif­i­cant­ly in 2025 amid weak­er in­dus­tri­al ac­tiv­i­ty and rel­a­tive­ly high spot liq­ue­fied nat­ur­al gas (LNG) prices in the first half of the year. De­mand in­creased by 1 per cent in 2025, trans­lat­ing to an in­crease of around 40 bcm (or 1.4 EJ) in ab­solute terms. Es­ti­mat­ed glob­al LNG de­mand in 2024 was about 400 bcm. Be­tween 2025 and 2030, around 345 bcm/yr of new LNG ex­port ca­pac­i­ty is ex­pect­ed to come on­line from projects that had al­ready reached FID and were un­der con­struc­tion at the start of 2025. This rep­re­sents the largest LNG ca­pac­i­ty wave in any com­pa­ra­ble pe­ri­od in LNG mar­ket his­to­ry. This fig­ure ex­cludes ca­pac­i­ty ad­di­tions from Rus­sia’s Arc­tic LNG 2 project (27 bcm/yr) and Qatar’s North Field West ex­pan­sion (22 bcm/yr) — projects that have been ap­proved but are not pro­gress­ing to­ward nor­mal com­mer­cial op­er­a­tion.

In five years, glob­al LNG sup­ply is ex­pect­ed to rise by near­ly 86 per cent, ver­sus an ex­pect­ed growth rate of 2-2.5 per cent per year. Where will this ex­cess vol­ume go? LNG prices are ex­pect­ed to fall sig­nif­i­cant­ly, strong­ly en­cour­ag­ing a shift away from coal. LNG de­mand growth is un­der fur­ther down­ward pres­sure as re­new­ables pen­e­trate more and high-de­mand LNG users look to restart nu­clear fa­cil­i­ties.

Methanol and Its de­riv­a­tives prices

Views by an­a­lysts will vary. How­ev­er, a com­mon thread is that methanol ca­pac­i­ty ex­pan­sions are ex­pect­ed to slow sig­nif­i­cant­ly through 2030, with most ad­di­tions con­cen­trat­ed in Chi­na, via in­te­grat­ed CTO, and the Mid­dle East. Over­all, the sup­ply-de­mand out­look through 2030 con­tin­ues to sup­port methanol prices mov­ing to­ward sus­tained rein­vest­ment lev­els, with any fur­ther re­duc­tion in Mid­dle East sup­ply like­ly to ac­cel­er­ate that pace. That means prices are not ex­pect­ed to fluc­tu­ate much be­yond nor­mal an­nu­al de­mand cy­cles.

Am­mo­nia and Its de­riv­a­tives prices

One an­a­lyst’s view is that the am­mo­nia mar­ket out­look points to con­tin­ued grad­ual soft­en­ing in glob­al am­mo­nia prices through the re­main­der of 2026, with a more pro­nounced am­mo­nia price cor­rec­tion ex­pect­ed from ear­ly 2027 as new US and Mid­dle East am­mo­nia pro­duc­tion ca­pac­i­ty ramps up and glob­al fer­tilis­er re­stock­ing de­mand nor­malis­es ahead of the spring 2027 plant­i­ng sea­son. In oth­er words, prices are ex­pect­ed to re­turn to low­er lev­els than those seen dur­ing the 2026 up­surge dri­ven by the Iran con­flict. Like­ly to see a re­turn to 2024/2025 prices.

Em­ploy­ment Con­sid­er­a­tions

The At­lantic LNG fa­cil­i­ties di­rect­ly em­ploy ap­prox­i­mate­ly 500 per­sons and process about 50 per cent of the nat­ur­al gas. Oth­er mid­stream and down­stream fa­cil­i­ties di­rect­ly em­ploy over 2,800 peo­ple. When con­sid­er­ing in­di­rect con­tract labour, a safe es­ti­mate is 2x. The em­ploy­ment im­pact of down­stream petro­chem­i­cals and steel is a mul­ti­ple of that of the LNG fa­cil­i­ties.

Wish­es for a brighter 2027

T&T ex­pects NGC to en­gage the ex­per­tise need­ed to con­duct the rig­or­ous analy­sis to sup­port its de­ci­sions and po­si­tions in gas con­tract ne­go­ti­a­tions, hope­ful­ly avoid­ing fur­ther de­te­ri­o­ra­tion in the down­stream sec­tor. Mr Mooti­lal, your 40 years of down­stream petro­chem­i­cal ex­pe­ri­ence is des­per­ate­ly need­ed to ad­vise the NGC Chair­man and Board. T&T ex­pects him to rise to the chal­lenge and de­liv­er strong out­comes for the petro­chem­i­cal down­stream in­dus­try.

When the ham­mer drops dur­ing the 2027 down­stream nat­ur­al gas ne­go­ti­a­tions for “deal or no deal”, the coun­try wants to hear a re­sound­ing “deal”.

TT Pa­tri­ot is a pseu­do­nym for a down­stream in­dus­try ex­pert