Monday, September 26, 2022

T&T government, Shell discuss possible restructure of Atlantic LNG

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A potential restructure of Trinidad and Tobago’s Atlantic LNG dawns as a team of top government officials led by the Prime Minister Keith Rowley recently engaged with Shell Global at its Hague headquarters to discuss future developmental plans for the twin-island Republic.

According to a release from the Ministry of Energy and Energy Industries, a new timetable was agreed to for this to be completed.

“The restructuring of Atlantic LNG is setting a precedent globally as this has never been done before i.e., the restructuring of LNG trains between private shareholders and a government. It is expected that when the terms are finally agreed that Trinidad and Tobago would derive significant benefits in areas like shareholding, structure, and pricing,” the ministry outlined.

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Atlantic is one of the world’s largest producers of liquefied natural gas (LNG), producing from fields in and around T&T to its liquefaction facility headquartered in Point Fortin.

It boasts four massive LNG trains – with a total production capacity of around 14.8 million tonnes per year. Its fourth train is among the largest in the world with a capacity of 5.2 million tonnes of LNG per year.

And Shell is the majority stakeholder in each train. It has 46% in the first, 57.5% in the second and third and 51.11% in the fourth.

Since Shell’s return to T&T and its acquisition of British Gas, the government said it has worked closely with the company to ensure its investments and expansion of gas production.

Shell’s current T&T natural gas production stands at 850 million standard cubic feet per day (mmscf/d) – the reported highest level since its return in 2016.

“This critical production is a direct result of the partnership between the government and Shell and the work that we have done with them to ensure terms that deliver fair value to both Shell and the citizens of Trinidad and Tobago,” the ministry noted.

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Discussions were held on Shell’s future gas production outlook, including Manatee, which will be the largest investment in gas production in the country in over a decade. And with respect to exploration and production at the Soldado field, the government also obtained a commitment from Shell to assist with improved seismic appraisal and interpretations of the resource.

T&T’s former Energy Minister, Kevin Ramnarine had said that natural gas production in 2021 was the lowest in 18 years and that it will require creative thinking to drive economic growth.

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