Correcting the record on natural gas curtailments

Kevin Ramnarine.

By Kevin Ramnarine

Last Wednesday in Parliament, Stuart Young said I never told the country about the curtailments of natural gas supply. He declared that I had continuously blamed it on maintenance and blamed it on the oil spill in the Gulf of Mexico.

He said, “So, you didn’t tell the country about the curtailments. It was maintenance. He continuously came, not only to Parliament, but in public and said it was maintenance. He even blamed it on the oil spill that had taken place in the Gulf of Mexico and said as a result of that BP had pulled back and they were looking at and maintaining all of their platforms and assets. Not true!”

The first observation is that his statement is contradictory. He starts by saying that I never told the country about the curtailments and then goes on to refer to my comments on the said issue. It also seems that he thinks “maintenance” and “curtailments” are mutually exclusive events. If that is the case, he is wrong.

After listening to his interpretation of history, I can only conclude that he does not understand the issue or has been seriously misinformed. Either way, it would be interesting if he could tell us what he thinks is meant by the term “curtailment”.

Psychology tells us that people believe what they want to believe. This this is called, “confirmation bias”. It is the tendency to interpret information in a way that confirms one’s preconceptions.

As you can see in his statement, Minister Young emphatically exclaimed at the end of his sentence “Not true”. The inference is therefore that I lied. The facts will however always show that there was a huge maintenance programme conducted by BP that spanned from 2010 to 2014 and that said programme was but one factor that caused the curtailment of natural gas supply.

Everyone in the industry who is reading this knows it to be true. However, in the year 2017 Anno Domini we have a Minister saying that I made all this up and, I ingeniously linked it to the April 2010 Macondo Oil Spill in the US Gulf of Mexico. Why would I make that up? Perhaps CNN’s Anderson Cooper also made up the BP Macondo oil spill to boost his TV ratings.

So, let us now look at two quotes. The first quote is from Platts (June 27th 2012). Platts quoted BPTT as saying, “After the Macondo oil spill in the Gulf of Mexico in 2010, BPTT embarked on a costly maintenance programme to improve safety levels and reduce the risks associated with its pipelines, plants and other infrastructure in Trinidad.

The second quote is from one of the country’s most respected experts on the natural gas sector, Frank Look Kin. On May 9th 2016 at a hearing of a Joint Select Committee, Mr. Look Kin explained the origins of the curtailments.

He said, “……there was this Macondo event in the Gulf of Mexico and the Macondo event, when it occurred, many companies basically started to consider new standards for operating offshore, and those new standards require upgrades of their existing platform facilities, and so what you had happening right after that in 2010 to about 2013, companies shut their platforms down temporarily to do repairs, to do maintenance to upgrade the standards. So, what you had happening in Trinidad was a case of whereby you had platforms coming down, a decrease in production…”

The two aforementioned quotes link the Macondo oil spill to a planned programme of maintenance by BPTT. So, what is the truth? The truth is that there was a major planned maintenance programme conducted by BPTT from 2010 to 2014 and it required platforms and hubs to be shutdown systematically and said shutdowns disrupted natural gas supply and led to curtailments in the supply of natural gas.

This was but one dimension behind the curtailments. Another dimension was brought on by a collapse in investment in the upstream sector from around 2008 to 2010. I have spoken about that ad nauseum.

On October 12th 2014, I was quoted in this newspaper (the Guardian) as saying, “On the issue of curtailments, this matter has been well ventilated in the public domain. The facts are that firstly there was a period of underinvestment by major upstream companies in the period 2008 to 2010 that has led us to where we are today.” A month later in the Sunday Express of November 29th 2014, I again said the same thing.

Far from doing nothing about all this, I recognized that the solution was to get the upstream drilling and exploring again. This meant making the investment climate more friendly via fiscal incentives and a collaborative approach to doing business. That approach breathed confidence into the sector and resulted in the investments that will yield results in 2017 and beyond. These results include, BP Juniper, BP “TROC”, EOG Sercan, BHP Angostura Phase III, the two 2017 BP exploration wells and the whole deepwater campaign led by BHP.

Politicizing the energy sector is taking the country down a very slippery slope that sends the wrong signal to investors at home and abroad who listen very attentively.

Kevin Ramnarine is a former Minister of Energy of Trinidad and Tobago

Guardian March 21 2017