Chamber says 2016 was an extremely difficult year for energy sector

PORT OF SPAIN, Trinidad, Dec 31, CMC – The Energy Chamber of Trinidad and Tobago has described 2016 as “an extremely difficult year for the energy sector” saying that while oil prices have recovered from the depths they experienced in the first-half of the year, they remain at low levels.
“The structural changes to oil and gas markets that led to the low-price environment have not gone away and look set to continue,” the private sector group said in a statement reviewing the energy sector here over the past 12 months.
It said that while Trinidad & Tobago has no control over international prices, it does have control over its own levels of production.
“The right policy environment could lead, in time, to increased production of both oil and natural gas.  Over the past year production levels have continued to decline.  Even with new gas coming on stream …gas production is likely to continue to decline over the first half of 2017,” it warned, noting that towards the end of 2017 there should be modest increases in gas production.
“However, if increases in production are to be sustained, policy decisions are required to ensure that Trinidad and Tobago is competitive and able to attract investment capital. “
The Chamber said that over the past year there have been significant discussions between the
industry and government on the new policy environment, including discussions on the structure of gas markets and taxation.
“However, clear detailed policy statements and actual changes to the taxation regime have not yet
been forthcoming.  Our expectation is that these will be significantly advanced in the first few months of 2017. “
The energy group said that competitiveness is not just important to attract investment capital in the energy sector, but is also vital if Trinidad and Tobago is to diversify its exports and increase the flow of foreign currency into the economy.
“The Energy Chamber continues to see major opportunities to diversify our exports through the export of energy services.  In 2016 we have been very active in securing opportunities for our companies in the emerging Guyanese oil industry, and we will continue to explore the opportunities in that new market actively in 2017.”
It warned that if Trinidad & Tobago is to become more competitive, it is vital that it deals with issues of productivity.
“The current low, and falling, levels of productivity in Trinidad and Tobago cannot continue if we want to diversify and create a more sustainable and secure future for all our citizens,” it said, adding “reform of the industrial relations framework and the overall labour market is needed urgently”.
The Chamber said that it worked closely with various stakeholders in 2016 to develop clear proposals for a modern and progressive legislative framework, based on International Labour Organization (ILO) principles that will drive productivity and boost the country’s competitiveness.
“We anticipate that these proposals will help shape the proposed new industrial relations and employment rights legislation that we expect to be introduced in Parliament during 2017.
“The past year was tough for the energy sector and 2017 is unlikely to be much better.  However, we can change the key policy and legislative measures that are hampering the sustainable development of our economy and with these changes a bright future is still possible,” it added.