I WAS extremely elated to see the reports of the successful completion and signing of the Dragon Gas Deal between Trinidad and Tobago and Venezuela.
Despite the insurmountable challenges associated with executing this deal, the persistence of the Prime Minister, Dr Keith Rowley and Minister of Energy and Energy Industries, Stuart Young has paid off.
I don’t think we as citizens can fully comprehend the difficulties and complexities which were involved in negotiating and executing such a deal and much credit must go to the Government for holding the course.
I am most optimistic because this Dragon deal represents much more than a gas deal between two countries, this may well usher in a new era in our energy industry with benefits reverberating for decades to come.
The Dragon deal is significant for many reasons. Firstly, we must understand where Trinidad and Tobago currently sits in terms of its gas reserves and capacity. The decision to monetize gas with the establishment of NGC paved the way for the creation of the Pt. Lisas industrial estate in the 1980s.
This fuelled a vibrant downstream industry with natural gas as its fuel and feedstock. Trinidad and Tobago became one of the largest global producers or Methanol, Ammonia and other products coming out of Pt Lisas.
This country levelled up once more with the establishment of our liquified natural gas facilities and the creation of Atlantic LNG.
Spurred by increased gas production, Trinidad and Tobago became one of the largest exporters of liquified natural gas in the world. However, for many reasons, including maturing gas fields, gas production began to wane. From a peak of 4.3 bcf of gas produced per day, production has gradually declined to 2.7 bcf per day.
However, there still remains an excessive demand for gas to power our massive industrial complex as well as to feed our LNG facilities. Our gas problem appears to be a structural one and unless major finds and development could be done at a rapid pace, the downward trajectory could continue, possibly hampering our industrial and economic development.
The question has always persisted, where do we get the gas? Venezuela on the other hand, has another problem.
They are possibly sitting on some of the largest gas reserves in the world, yet they are unable to produce and monetize it. An inevitable partnership between the two countries can only reap benefits for both.
Trinidad and Tobago is an experienced gas-producing and processing country with advanced capabilities, existing infrastructure and spare capacity. The gas can be processed once it gets to our shores to fuel our industrial complex as well as export. A partnership with Venezuela in this important matter of the development of its gas resources can only be a win–win for both countries.
Through the Dragon Deal, not only can massive gas fields be potentially developed, but a mutually beneficial partnership with our largest neighbour can be allowed to flourish. Access to additional gas from some of the largest reserves in the world can reverse the trend of declining production and thereby secure the future of our gas economy for decades to come.
I do not use these words lightly when I say this Dragon Deal is a game changer for this country. The people of this country should be thankful that such a partnership is available to be entered into at this point in time in our development, given the challenges we now face.
We also have to also be grateful that cool and patient minds prevailed over many years to navigate the numerous issues, which at times seemed insurmountable. In the end, the Dragon Deal and the partnership with the Venezuelan government, is not only historic but has the great potential of bringing economic benefits to both countries and its people.
Vyash Nandlal hold a Bachelor’s degree in Economics and an MSc in International Finance. He has more than 12 years’ experience in the field of economic research and analysis. He currently works as an economic researcher and advisor in the Office of the Prime Minister and sits on the boards of several state and non-profit organisations. The opinions and comments expressed by him are not necessarily those of AZP News, a Division of Complete Image Limited.
