North American shale gas production is worrying the governments of resource-rich countries such as Trinidad and Tobago, as global gas market developments have overturned the established order.
A spokesman for the Caribbean country's energy ministry told Platts at a conference in London Tuesday that he listened to the presentation by UK energy expert Dieter Helm with "some level of concern," as abundant cheap gas could deter investors from the higher-cost deepwater upstream market. The country produced 40.7 Bcm in 2011.
The amount of shale gas in the US has led to the world's biggest economy, with a quarter of the world's GDP, now not needing the imported gas for which much of Qatar's output was to be directed, leaving plenty of LNG available for other markets and easing the pressure to invest upstream.
Into this well-supplied market, Trinidad and Tobago is launching a new upstream round for its onshore and offshore oil and gas, although it has additional challenges to address.
The permanent secretary for the energy minister, Selwyn Lashley, told the World NOC Gas Congress that the country faces four problems: aging infrastructure, aging fields, competition for funding and competition from unconventionals.
Most of the country's oil and gas reserves under the country's jurisdiction are in water depths exceeding 4,000 meters, making it expensive in the current climate, where "competition is intense in previously unknown oil and gas provinces," he said.
To make the prospect more inviting for the 2012 bid round which was launched April 23, the government is offering better data sets for new rounds, and improving the fiscal and regulatory terms, Lashley said.
In the 2010-2011 round, he said, seven production-sharing agreements were signed, of which only three were in shallow water and the other four in average to deep water. They attracted $400 million in commitment spending with a further $500 million in optional spending, and represented some 10-15 Tcf and 1 billion barrels, he said.
The country is also stressing its rule of law, with the sanctity of contracts and an independent judiciary among its selling-points, Lashley said.
The country is also developing policies to take the energy sector global, Lashley said, and is seeking out opportunities to export its energy services.
