Exaggeration Fuh So In Energy
Posted: Sunday, December 19, 2004
By Stephen Kangal
The Manning Administration continues to treat the electorate/ Parliament with deliberate contempt, disrespect and disdain in spite of repeated media editorials and other requests from the population designed to ascertain the level of the windfall being derived from the unsustainable monetisation of our energy patrimony. This disrespect is now being manifested in deception fuh so.
May I in this respect refer to Minister Enill's recent Central Bank's address that T&T's proven and probable reserves of gas are set at 29.05 trillion cubic feet (tcf). On that tenuous data the Minister estimates that our gas supply based on current and projected consumption (2 tcf per annum) will last for 20 years. It is patently improper for Minister Enill not only to conceal the oil/gas revenue data from the population and but also to proceed to base the life span of our dwindling gas resources on probable reserves. Potential investors will not be misled by probable reserves of gas.
Even if both reserves were to be used with a projected consumption of 2 tcf per annum, 30 tcf of gas will last 15 years. Our current proven reserves of 18.85 tcf (down-graded by 1.9 tcf by Minister Williams in the Budget) and having regard to our current and projected consumption of 2 tcf, will last 10 years if no new discoveries are made. How can we fulfill our LNG obligations to Jamaica for 20 years, offset the costs of the US$ 1 bn Caribbean Gas Line and sustain the rising expectations that were fuelled by Minister Williams when we have ten years of gas left in the ground?
Let us now turn to Minister's Williams inflated and exaggerated statements on the BHP Billiton/ELF/Talisman Block 2c East Coast oil find that he projected would have ushered in a new oil bonanza (oil fuh so). He estimated a production of one billion barrels only to realise that it is down-graded to 160 mn barrels. It will only add 75,000 bpd and not double our daily production as predicted by Minister Williams.
Oil production from the said BHP Billiton Angostura field should have started on December 9 using the Kairi 2 platform built in T&T. Even this failed to materialise on time.
Minister Enil supported by Ministers Sahadeo and Khan cannot tell us the owners of the patrimony, the revenue implications of an escalating oil price that is 100% over our budgeted US$25. However PM Manning has already quantified that he would lavish US $300m on Caricom countries to eradicate poverty from an oil-price above US$32 and assigned the CDB to disburse this largesse with no strings or quid pro quo.
Prior to the current period of outright deception I was always made to understand that former Amoco East Coast sweet or sulphur- free crude fetched US $1 above North Sea Brent Crude price.
There is a predilection to gross political exaggeration of the quantum of our hydrocarbon resources. This can generate a climate of rising expectations within the population/trade union movement that cannot be sustained and may produce a 1970/1990 encore. Short of this it is a prescription for social instability, astronomical wage demands and cancerous inflationary pressures.
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