Nat­ur­al Gas pro­duc­tion av­er­aged less that three bil­lion cu­bic feet per day (bcf/d) for the first time since the 1990s ac­cord­ing to well placed sources at the Min­istry of Fi­nance.

The Sun­day Busi­ness Guardian has learnt that for Jan­u­ary 2021 nat­ur­al gas pro­duc­tion av­er­aged 2,990 mil­lion stan­dard cu­bic feet per day (mm­scf/d) or less than 3bcf/d. This is 1.2 bcf/d less than the in­stalled ca­pac­i­ty in T&T and is part of the rea­son the Min­is­ter of Fi­nance Colm Im­bert has raised alarm at the low nat­ur­al gas pro­duc­tion.

On Jan­u­ary 10, Im­bert told a news con­fer­ence that due to de­pressed oil and gas prices and low­er than ex­pect­ed pro­duc­tion, rev­enue from roy­al­ties on oil and gas was down by al­most half – $806 mil­lion or 49.2 per cent. Mean­while ex­tra or­di­nary re­ceipts from oil and gas com­pa­nies al­so fell by 98.2 per cent or $100 mil­lion.

The Cen­tral Bank in its Eco­nom­ic Bul­letin for Jan­u­ary re­port­ed that nat­ur­al gas pro­duc­tion de­clined by 23.6 per cent (year-on-year) over the sec­ond half of 2020. The bank said At­lantic LNG’s Train 3 was tak­en down for planned main­te­nance dur­ing the pe­ri­od, which co­in­cid­ed with sim­i­lar ac­tiv­i­ty at BPTT, the coun­try’s largest nat­ur­al gas pro­duc­er. The fourth quar­ter of 2020 al­so saw a drop in LNG pro­duc­tion at Train 1 amid dis­cus­sions amongst its share­hold­ers sur­round­ing the fu­ture op­er­a­tion of the fa­cil­i­ty. Nat­ur­al gas pro­duc­tion dropped 29.8 per cent (year-on-year) dur­ing Oc­to­ber to No­vem­ber 2020 along­side a 46.9 per cent fall in LNG pro­duc­tion.

The bank not­ed that the down­stream in­dus­try al­so saw de­clines in out­put, with methanol pro­duc­tion de­clin­ing 29.4 per cent dur­ing the pe­ri­od, while pro­duc­tion of am­mo­nia was down by 1.1 per cent.

The trend ap­pears to have con­tin­ued last month with low nat­ur­al gas pro­duc­tion.

The Sun­day Busi­ness Guardian has learnt that the short­fall has made the NGC fur­ther cut back on its dai­ly con­tract­ed quan­ti­ties (DCQ) to the down­stream sec­tor mak­ing an al­ready bad sit­u­a­tion worse.

This is now ten years that T&T has been suf­fer­ing from nat­ur­al gas cur­tail­ment.

The short­age has caused an in­crease in the unit cost of petro­chem­i­cals com­ing out of T&T as well as the new gas prices ne­go­ti­at­ed by a team led by Prime Min­is­ter Dr Kei­th Row­ley.

An­drew Jupiter the for­mer Per­ma­nent Sec­re­tary in the Min­istry of En­er­gy, a for­mer Pres­i­dent of Na­tion­al En­er­gy and now an oil and gas con­sul­tant said he did not think the prob­lem of nat­ur­al gas short­age can be solved any­time soon.

In an in­ter­view with the SBG Jupiter said: “Short term we will nev­er be able to come back to 4.2 bcf/d. In the long term I don’t think we will be able to do that ei­ther.”

Jupiter ad­mit­ted that the on­ly chance of the coun­try pro­duc­ing 4.2 bcf/d will be to bring on the Lo­ran/ Man­a­tee cross bor­der field and he said that could make a ma­jor dif­fer­ence but point­ed to the deep wa­ter as the best pos­si­bil­i­ty of long term high nat­ur­al gas pro­duc­tion.

He praised the move by the gov­ern­ment to get agree­ment with the Bo­li­var­i­an Re­pub­lic of Venezuela for Roy­al Dutch Shell to pro­duce the 2.7 tril­lion cu­bic feet (tcf) of gas that is on T&T’s side of the bor­der out of the 10 tcf in the field. He felt that this coun­try will even­tu­al­ly pro­duce the 10 tcf in T&T.

But he warned that it’s not just pro­duc­tion that mat­ters its al­so

Jupiter said, “One of the things peo­ple for­get is the is­sue of price. So you may have gas but the price is too high.”

The for­mer Per­ma­nent Sec­re­tary said the coun­try must un­der­stand that what im­pacts us now is as a re­sult of ac­tions tak­en 10 to 15 years ear­li­er.

In this re­spect he ad­mit­ted that the six years the coun­try has gone with­out a bid round will have an ef­fect on the coun­try down the road.

Jupiter told SBG that the coun­try was no longer find­ing 1 tcf pools and the time had come for changes to the law to al­low the shar­ing of oil and gas in­fra­struc­ture with small­er play­ers be­ing al­lowed to de­vel­op small­er nat­ur­al gas fields.

He al­so point­ed to the var­i­ous ex­am­ples of re­lin­quished blocks lead­ing to ma­jor dis­cov­er­ies in­clud­ing the Teak Samaan Poui dis­cov­er­ies and BH­Ps 2c dis­cov­ery.

Jupiter said he re­mained con­fi­dent the chal­lenges in the en­er­gy sec­tor can be solved but re­quired all hands on deck and the best minds in the coun­try work­ing to­geth­er.