Menu
RSS
zhen

A Talk with Dr. Driver, CEO of the Energy Chamber of Trinidad & Tobago

Dr. Driver, CEO of the Energy Chamber of Trinidad & Tobago

As Chinese energy companies seek to expand their business overseas, Trinidad and Tobago is the first port of call in the Caribbean. The island nation is the region’s largest producer of oil and gas, which account for a whopping 40% of its GDP and 80% of exports.

Starting with the drilling of the first oil well near the Pitch Lake in South Trinidad in1857, over more than the past 100 years Trinidad has produced more than three billion barrels of oil. Estimated crude oil reserves in 2013 reached about 728 million barrels, according to the EIA, and the nation shows no signs of slowing down.

In addition to oil, Trinidad also has a booming natural gas sector, with its Phoenix Park Gas Processors Limited among the largest natural gas processing plants in the Western Hemisphere. The facility is based in the Port of Savonetta and boasts processing capacity of nearly two billion cubic feet daily, or a daily output capacity of 70,000 barrels.

It is no surprise that the roster of oil and gas companies operating in Trinidad includes the world’s largest players, with major Chinese oil players such as LandOcean entering the market. Given that Trinidad’s oil and gas sub-sectors are seeing a surge in the realm of deep water exploration, and have received a recent nod of acknowledgement for their adherence to international laws and transparency, there is no better time than now for Chinese firms to consider establishing operations in the country.

We spoke with Dr. Thackwray“Dax” Driver, Chief Executive Officer of Trinidad’s Energy Chamber, about what these exciting developments mean for Chinese investors eager to engage the country’s energy sector.

  1. Relative to other countries, can you briefly describe the current state of development of Trinidad and Tobago’s (Trinidad for short, going forward) trade and economic relationship with China in the energy sector — in particular?

Trinidad & Tobago has a very long history in the oil and gas industry, going back well over a century. There has traditionally been limited trade and economic relationships between Trinidad &Tobago and China in the energy sector, but this has been changing in the recent past mainly through Chinese companies investing in our energy sector. In the upstream sector, Chaoyang Petroleum (BVI) Limited, a consortium between CNOOC and Sinopec, hold a 25% non-operator interest in the offshore Angostura oil and gas development operated by BHP Billiton.

Another Chinese company, LandOcean, is a major investor and strategic partner in the London-listed Range Resources, who hold various exploration and production blocks onshore Trinidad. There are also a number of Chinese companies active in the energy services sector, such as Kerui Group who have been supplying equipment and services to the oil industry, in particular in the drilling sub-sector. There is also Chinese state investment in the Atlantic Liquefied Natural Gas facility. In terms of trade, there are very limited volumes of products from Trinidad to China. There are occasional LNG cargoes that do make it to China and we also supply asphalt to China from the world famous La Brea pitch lake.

  1. I’ve read that one of the major new investors in Trinidad is the Chinese advanced oil recovery company LandOcean. Is LandOcean a trailblazer among Chinese oil firms in Trinidad’s oil sector, or one of many already involved? Do you expect the company’s presence to trigger a wave of Chinese investment in the oil industry?

LandOcean has entered the Trinidad market through their strategic alliance and investment in Range Resources.  They are active in both the drilling sector and, through Range, in oil production.  They have also stated their intention to become involved in other sectors including seismic data storage.  They are not the first Chinese company to invest in our oil sector, but they have been very active in the recent past and are playing an important role at the moment. 

Through their involvement in the drilling sector, they are interacting with a wider number of established companies in Trinidad.  Given our very long history in the industry, Trinidad & Tobago has many skilled professionals in the energy industry and companies with long histories of involvement in the sector.  This creates the opportunity for sharing of knowledge and technology between Trinidad and China.

  1. What are some of the specific projects that are or will be open for investment in Trinidad’s downstream energy sector, which could potentially be of strong interest to Chinese investors?

Trinidad’s downstream petrochemical and gas processing sector underwent a period of rapid growth between the mid-1990s and the late 2000s.  For the past seven years there has been limited new growth in the petrochemical or gas processing sectors.  The focus of investment over the past few years has been in the upstream, to ensure that we are able to find new gas reserves and maintain production at current levels. Given the expectation for future gas finds and increased gas production going forward, National Energy – our state agency responsible for developing energy projects – is currently developing a suite of downstream energy projects that will allow us to further expand down the energy value chain closer to final products for markets in CARICOM and to supply the expanding Latin American market from our strategic location in the Americas. Our latest downstream project to receive approval is a methanol and DME plant, with investment from Mitsubishi Corporation, the Trinidad & Tobago National Gas Company and a local conglomerate, Massy.  Other projects being developed by National Energy and which they are seeking to attract investment include plastics, inorganic chemicals and renewable technology manufacturing.

  1. What does EITI compliance mean for Trinidad and China in terms of potential collaboration and investment?

Trinidad & Tobago achieved EITI compliance in February 2016. This means that the global EITI movement recognized our efforts to provide comprehensive information, verified by an independent third-party, on the revenue received from the upstream oil and gas industry by the Government of Trinidad & Tobago. Compliance with EITI gives international investors increased assurance about Trinidad & Tobago’s adherence to international standards of governance and a commitment to transparency. The EITI reports, available online, are also an excellent source of information about the upstream energy sector.

  1. What specific benefits — legal, taxes, etc. — does Trinidad offer to potential Chinese investors?

Trinidad & Tobago has introduced a number of reforms to encourage investment over the past few years, including tax incentives to encourage new exploration and development in the upstream energy sector. Trinidad & Tobago offers a level playing fields for investors from all countries and we welcome direct foreign investment from any part of the globe.

  1. How significant do you envision Chinese investment to be in Trinidad’s energy sector a decade or two down the line, compared with that of other nations?

Traditionally our major investors in the energy sector have been from the United Kingdom, the United States, Canada and Germany. As a country we are open to investment from all sources, including from China. The opening of the new Trinidad and Tobago Embassy in China should help to foster deeper economic and social ties between the two countries and we look forward to welcoming new investors from China in the future. 

The Energy Chamber of Trinidad & Tobago organizes the major energy sector conference in Trinidad & Tobago each year (it will be on the 18th January 2016) and we welcome delegations from around the world to the event. This is an ideal time for Chinese investors and business people seeking new markets to visit Trinidad & Tobago and to learn more about our sector.

back to top

Core Links

China Offshore

Invest In

Contact Us

Rooms 05-15, 13A/F, South Tower,
World Finance Centre, Harbour City,
17 Canton Road, Tsim Sha Tsui
Kowloon Hong Kong