T&T contract renegotiations to be finalized by August

Jun 22, 2019 News

The government of Trinidad and Tobago doesn’t have much longer before it wraps up negotiations with the shareholders of Atlantic LNG, a liquefied natural gas producing joint venture operating there.

T&T Minister of Energy and Energy Industries, Franklin Khan

Prime Minister Keith Rowley had announced the country’s plan to engage the shareholders, last year.
His administration had found that there was a need to discuss better terms and conditions for improved revenue for Trinidad and Tobago from LNG sales.
He had said that the government has a role to ensure that the people get “more than crumbs that fall off the table”.
The government faced myriad criticisms from the political opposition, United National Congress (UNC), that the renegotiation would scare away investors and damage the sanctity of contracts.
But T&T Minister of Energy and Energy Industries, Franklin Khan, said in an address to the House on June 11, last, that those criticisms were uninformed and incorrect.
He explained that the government had been working assiduously on the relationships with the oil companies. He said that it was necessary to build a platform of mutual respect, “and an ability to sit in the same room as equals with these sophisticated multinational companies”.
Phase 1 of the negotiations resulted in Royal Dutch Shell agreeing to pay the government approximately US$397M to the end of this year.
Khan relayed to the House that Phase 2 of negotiations will focus on the marketing arrangements of Trains 1, 2 and 3, and the restructuring of the four LNG trains into a single unit, with the primary aim to ensure that NGC gains more.
“The government will be seeking to increase its shareholding throughout Atlantic LNG.” Khan said.
Currently, the T&T government, through NGC, has a 10 percent equity holding in Train 1, an 11.1 percent equity holding in Train 4, but none in Trains 2 and 3.
Khan said, on June 11, that the Heads of Agreement with Shell embodying many of the issues discussed with the shareholders was signed on May 29 in The Netherlands, and that definitive agreements will be finalized over the next two months.
He assured that, contrary to the negative criticisms the government fielded, all of the oil companies promised continued investment.

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