Chairman of the National Gas Company (NGC) Gerry Brooks is urging officials of the Caribbean Nitrogen Company (CNC) to “come back to the table, and look at NGC’s offers which he said “is a fair offer which allows CNC to make double digit returns but avoids NGC and the people of T&T suffering billions of dollars in losses.” He said it can save the jobs of the company’s 400 workers.
Speaking on the CNC3 Morning Brew yesterday, Brooks said CNC’s contract with NGC expired on October 18, 2017, “since that time the NGC has facilitated four extensions of the contract to allow the parties to arrive at a mutually acceptable position.”
He said, “Notwithstanding that they were out of contract we continuously extended to try to facilitate discussions, tailoring our offers continuously.”
During those discussions, Brooks said, NGC took into consideration the country’s gas curtailment problem and “the reality of increased gas pricing.”
He said NGC sought to “moderate those increases in a way that CNC shareholders will get a fair return, but that the NGC will not suffer billions of dollars of losses and the people of Trinidad and Tobago will not suffer billions of dollars in losses.”
According to Brooks, the offer was “revised on multiple occasions, since we first started meeting CNC.”
Brooks said, “We have been very reasonable, we have been very careful and researched, doing what we call gas value chain analysis, but we must also be a responsible company acting on behalf of the people of Trinidad and Tobago.”
He said the deal which CNC had put on the table would have seen “CNC winning,” but which would have resulted in T&T suffering “two to four billion dollars in losses, the country cannot afford that, the NGC cannot afford that,” he said.
On the other hand, he said, NGC offer will allow for a win, win situation. “We feel that nobody will lose. All of our margins will be reduced, but we will be able to survive,” Brooks said.
Brooks said gas supplies locally have fallen from 4.25 billion cubic feet to 3.2 billion cubic feet, and NGC has been “working assiduously with up-streamers and the government to improve that supply.”
He was confident that the supply will improve this year “as a consequence of considerable work done with BP on TROC, on Juniper, with BHP, with Shell etc,” but the current reality he said is that there is a shortage of gas of 2-3 hundred million cubic feet.
He said as a result there is need “to reset the architecture from a policy perspective. So what we are trying to do is that we provided gas certainty between 2019-2023 period, those are the agreements that the Honourable Prime Minister negotiated when he went to Houston,the EOG supply and the BP supply.”
The irony is that EOG Resources is one of the three multinational companies that own CNC. The other subsidiaries are the Proman Group and Koch Ag & Energy Solutions, LLC.
Asked whether NGC was willing to get into a “showdown” with these international players, Brooks said “that is not the approach of the NGC.”
He said the Board and management of the company “are interested in ensuring that we find an arrangement from a policy perspective and from a company perspective that allows all to navigate this period and to continue to grow and to develop.”
“What the NGC will not do,” he said “is to put at risk thousands of jobs in Trinidad and Tobago because we have struck a bad deal in the name of signing a deal.”
Brooks said it was in the interest of getting a deal beneficial to all sides that the NGC “facilitated and offered those extensions holding out the olive branch with a view to trying to arrive at a mutually acceptable arrangement, we listened very carefully to CNC’s request and we tailored and modified our offers to accommodate their request.”
