TT Oil Minister faces public with audit reports  

May 09, 2024 News

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– as Guyanese remain in the dark after two audit reports completed

Kaieteur News – Trinidad and Tobago Minister of Energy and Energy Industries, Stuart Young on Tuesday presented that country’s two latest independently conducted audits on the nation’s remaining gas resources – a stark contrast to what obtains here, where Guyanese have yet to be officially updated on the findings of two audits conducted on ExxobnMobil’s expenses.

Guyanese is also not aware of the true quantity of its oil and gas resources, although ExxonMobil Guyana had put the oil figure at 11 billion barrels in the Stabroek Block several years ago. The TT audits on its gas resources were conducted by independent petroleum consultant DeGolyer and MacNaughton (D&M) of Dallas, Texas, USA on behalf of the Ministry of Energy and Energy Industries. This was their first time auditing the country’s gas reserves.

The last time this country’s gas audit figures were revealed was on December 14, 2021, when the results of the audit for the year ended December 31, 2020 were released. Young on Tuesday also apologised for the delay in the release of the latest audit results. “I must take personal responsibility and apologise for the delay, as the audit results have been ready for some time, but due to my professional commitments, I was unable to present until today. So that fault is mine,” Young said. Young sought to break down the findings of the latest audit. “When you see P1 and C1, that means what we know is there for sure, and what is under contract to be developed. So, we are looking at 11.4 trillion cubic feet (tcf) of gas,” Young said.

T&T currently utilises one tcf of gas a year, according to the latest figures, Young said, and therefore with the 11.4 tcf we have, there are around 11 years of supply remaining. “So by projection, if you have 11 and a half tcf, you’re looking at about 11 (years), if we were to continue gas production on current rates—11 more years of natural gas in our domestic fields,” he said. However, Young said that according to the results, the other technically recoverable quantities P2+C2 (4.9 tcf) and P3+C3 (5 tcf) provides this country with the possibility of approximately ten more years of possible gas supply.

“So that’s about nine tcf that you know exists. And what you need to do is that exploration or the appraisal wells, and then bring it to production,” Young said. “So you’re looking at, when you look at those figures, approximately a potential of another ten to potentially 20 years,” he said.

The natural gas reserves are divided into three categories based on the certainty that the resources will be extracted. P1 and C1 are proven resources with a 90% certainty of commercial extraction, P2 and C2 are given to reserves that have a 50% certainty and possible resources are labelled P3 and C3 since there is a 10% chance of commercial extraction.

Young described the latest audit report as “encouraging, good news, positive.”

He said the Government was looking forward to projects such as the Loran-Manatee gas field, since the Manatee gas field can produce up to three tcf of gas, while Loran can produce seven tcf. “You would see ten tcf of gas, which is actually just one tcf off of what we have in P1 and C1. So, when that Manatee gas starts to come on stream, and eventually Loran will come on stream, you will see that it immediately moves T&T off one field, doubling the current amounts that we have in that P1, C1 category we have there right now,” he said.

Young also touched on the incentives that are open for upstreamers and said, “I am not looking, on behalf of the people of T&T, to give out any more incentives.” “I think there are sufficient incentives there. But where we are working with persons is if, for example, they see a stranded amount of gas in a nearby block, etcetera, we have had instances of that, where we said we would extend your block to capture that stranded field and allow it there. We are prepared to work with you on areas and aspects of pricing and taking risks, etcetera,” he said.

Co-founder and managing director of DeNovo Energy Ltd Bryan Ramsumair, who was present at the release of the audit results, said, “What is encouraging us is not only the fact that we see a reserve replacement, but the minister is indicating the willingness to talk to upstreamers about acreage where it is near to infrastructure to be able to put new terms and conditions in place.” Ramsumair said this development is positive news for the people of T&T.

Meanwhile, also speaking at the conference was Permanent Secretary in the Ministry, Penelope Bradshaw Niles who pointed out that:  “these audits give a snapshot of national reserves and resources; the results are used by the ministry to ensure that the government is strategically positioned to guide business and operational decisions.” Bradshaw-Niles reminded that since 2000 the country has annually—with the exception of one year—consistently provided not only the stakeholders in the industry but the citizens with an annual update of the country’s gas reserves.

According to the Permanent Secretary, before the engagement of independent consultants by the ministry, there were multiple reserve and resource standards done by separate operators—as is the case in Guyana. This, she lamented meant that aggregating volumes to produce the country’s resource figure was not an easy task and gave rise to inconsistencies.”

With the use of an external independent consultant hired by the Ministry, she said this allowed for the consolidation of the information, “to ensure we are comparing apples to apples, since 2000, we have produced annual reports consistently.” She did note that the accomplishment was had in large part due to cooperation of the natural gas companies who supplied critical data “so the auditors can do their job.”

According to Bradshaw-Niles, “the use of this standard means that the methodology and standard can be widely understood and used as a basis for guiding development strategy, in order better understand government decisions the reports are made public.” T&T was described by the programme’s moderator as having a well-developed downstream petrochemical industry based on natural gas which makes conducting regular audits essential.

It was explained that the audits also “helps to provide security to so supply assurances to large downstream sources users and investors.”

Guyana’s oil reserves

Meanwhile, even as Trinidad has conducted such an audit of its gas resources, Guyanese are still in the dark as to true figure of their oil reserves. Recently, Chairman of Wales Development Authority, Asgar Ally said that some 15 billion barrels of oil have already been discovered to date in the Stabroek Block. This is despite Vice President (VP) Bharrat Jagdeo and ExxonMobil Guyana Limited (EMGL) Country Manager, Alistair Routledge maintaining that the country’s resources have not significantly moved since the last update in 2022 when it was at 11 billion barrels. Ally, while representing Guyana at the Jamaica Stock Exchange Conference held back in January, had made the disclosure of an additional 4 billion barrels of oil being discovered. “As of this point in time, we don’t know the full extent of the oil deposits but it’s huge and I could explain what that means. It’s about I would say they have identified at least 15 billion barrels of oil in the (Stabroek) Block. So at this point in time, I would say Exxon has identified about 25 to 35% of that,” Ally who is an economist stated.

Although eight new discoveries were made since Guyana’s last resource update in April 2022, with one of those estimated to hold some 746 million barrels of oil, Exxon and Guyana’s Vice President have stated that the country’s estimated 11 billion barrels of recoverable resources remain with no significant improvement.

Former Minister of Public Infrastructure, David Patterson, during a recent Alliance For Change (AFC) press conference said “something ain’t right” about the explanation provided by the Head of EMGL, Alistair Routledge and Vice President Bharrat Jagdeo that the country’s reserves have not significantly grown since April 2022, following eight new discoveries.

Patterson said it was unbelievable that three years ago, the Stabroek Block held an estimated 11B barrels and although eight significant discoveries were announced by Exxon, the nation is being informed that there is “no significant increase.” The politician explained, “Every country, there is proven reserves, the benchmark is proven oil reserves, not proven oil resources…I think Exxon’s Head was trying to be disingenuous and trying to use language to kerfuffle the public but you cannot. You have proven oil reserves; it is quite easy…I have seen reports from the Ministry of Natural Resources when we were there, they gave estimated reserve numbers.”

He said the company and government have the country updated estimated oil reserves but are deliberately keeping the country in the dark. Patterson told reporters that Exxon at the behest of the government is concealing the country’s reserves which could be as much as 20B barrels now.

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• audit reports, De Golyer and MacNaughton, Minister of Energy and Energy Industries, Stuart Young, Vice President

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