EnergyNow – May edition

Opinion | Mark Loquan

Preparingfortheeraofhydrogen

Opinion | Sheldon Daniel

Uppingthestakesonrelationshipmanagement forbusiness–andwhyyoushouldactnow Page 15

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A publication of the Energy Chamber of Trinidad and Tobago Issue 36 May 2021 • Free Copy

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New contracts in the downstream petrochemical sector signed by NGC

Ruby Project to enhance gas supply to NGC Page 3

TRINIDAD and Tobago can expect to see a healthy boost in its supply of crude oil and greater stability in natural gas production as the Block 3(a) Ruby development project begins production ahead of schedule.

Operator, BHP announced first oil from the development on May 4th, 2021 and first gas is expected to occur shortly thereafter.

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BPC update on activities in Suriname – well to be drilled in July 2021 BPC has indicated that they plan to drill an appraisal well and extended well test at Weg Naar Zee in Suriname in July 2021, at a budgeted cost of US$0.7 million.

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Regional threats and opportunities

Proman facility in Pt. Lisas, Trinidad

BHP ANNOUNCES FIRST OIL PRODUCTION FROM RUBY

Page 03 Page 04 Page 06 Page 08

PETERSON LOADS THIRD AND FINAL CHRISTMAS TREE FOR BP MATAPAL 'STENA CARRON' SERVICED IN T&T WATERS

METHANEX REPORTS STRONG FIRST QUARTER RESULTS NEWS

OPINION

EFFICIENCY

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ENERGY DATA page 19

RENEWABLES page 22

The eruption of the La Soufrière volcano in St Vincent in April 2021 was a vivid reminder of the threats of natural disasters that face us in the Caribbean region. It was also a reminder of both the resilience of our people and how well the regional private sector can pull together and deliver support and relief in the face of disasters. The outpouring of support from individuals, nongovernmental organisations and companies across the region has been impressive.

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New contracts in the downstream petrochemical sector signed by NGC Staff Writer | Energy Chamber THE National Gas Company of Trinidad and Tobago Limited (NGC) recently signed two contracts with downstream petrochemical plants. Over the past year, several natural gas contracts expired and negotiations were initiated to renew the contracts to ensure the natural gas supply to those petrochemical facilities.

In the past, long-term contracts were typically used, which according to the Gas Master, mostly expired between 2015 and 2020. Newer contracts have been short-term, about 3-5 years in duration.

Plants have also continued to operate with monthto-month interim agreements after their original long-term contracts expired.

It should be noted that many of the recent renegotiation terms and durations have been kept confidential due to the sensitive commercial nature of the contracts.

Recently, however, failure to renegotiate some contracts led to plants being forced to shut down as temporary agreements could not be achieved.

Notably, two Proman/MHTL facilities (M4 and M5000) were forced to close at the end of March until a new agreement was signed. These two plants are among the largest methanol plants in the country, and together they have the capacity to produce 2,470,000 Mt/y of methanol.

Other plants that have closed over the past year include the Methanex Titan plant and the Yara plant.

In April, NGC and Proman announced the signing of a new interim gas sales agreement which allowed the M4 and M5000 plants to be restarted.

The interim agreement was put in place while the commercial terms of a long-term gas supply contract are being negotiated between the two parties.

Mark Loquan, President of NGC, said, “The negotiating teams have had very constructive discussions to forge a path forward for the short term, while also remaining focused for longer-term collaboration, which will ultimately bring value to all stakeholders. I would like to thank both teams for their open and purposeful discussions which led to this agreement.”

Claus Cronberger, Managing Director of Proman Trinidad, said, “We are pleased to have reached an interim agreement with NGC to supply gas to M4 and M5000. Restarting the plants will bring immediate benefits to the gas value chain and the national economy. We remain focused on working with NGC to achieve a mutually agreed, sustainable, long-term gas supply contract in the shortest possible timeframe.”

In addition, NGC arrived at a new gas sales agreement with Yara/Tringen for the continued supply of natural gas to the Tringen 1 and Tringen 2 facilities.

During the signing ceremony, it was confirmed that the gas supply to the Tringen facilities would be covered under the new contract up to 2023.

The Tringen assets in Trinidad were some of the first petrochemical facilities built in Pt Lisas. Tringen 1 was commissioned in 1977 and just over a decade later, Tringen 2 was also commissioned. The two plants each have a nameplate capacity of 500,000 Mt/year; each therefore, together can produce 1,000,000 Mt of ammonia per year.

At the signing, Yara Trinidad President, Richard De La Bastide, expressed his appreciation to all the stakeholders who contributed to this achievement. He said, “The many meetings and the difficult environment made this one of the more challenging negotiations. I sincerely appreciate the professionalism of the NGC team, the support from Yara, our local negotiation team and particularly the role played by the Tringen Board. Tringen remains committed to developing its assets for the future to ensure the sustainability of our operations.”

Speaking at the event, Karen Darbasie, Chairman of Tringen, said, “The ever-changing global energy landscape often makes decision-making difficult, but the signing of the gas sales agreement helps to reduce some of the uncertainty relating to the external environment that affect the sector and secures the natural gas supply from the National Gas Company for the foreseeable future.”

(continued)

She added, “We as leaders reaffirm our commitment to collaboration with industry stakeholders as we all contribute to the long-term sustainability of the energy sector.”

At the signing event, the new Minister of Energy and Energy Industries (MEEI), The Honourable Stuart Young, lauded the efforts of all involved to bring the negotiation to a successful completion.

Minister Young noted that Trinidad had suffered from declining production but also noted that, “There are a lot of upstream projects that we are having conversations on to ensure certainty.”

Minister Young also hinted that gas may be available from outside of Trinidad and Tobago’s waters.

Minister Young also reinforced the government’s commitment to the gas-based industries in Trinidad and Tobago.

According to the NGC press release, work has also begun on the gas value chain analysis led by the MEEI, with a view to securing the future of the industry for the next decade, with active engagement planned for all other value chain players. The review is key to ensuring that Trinidad and Tobago navigates along a path of sustainability through the difficult economic and industry conditions now being faced.

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BHP announces first oil production from Ruby Staff Writer | Energy Chamber BHP announced that first oil production from the Ruby Field has been realised ahead of schedule.

The announcement was made recently when senior leadership from BHP, outgoing Country Manager, Vincent Pereira, and incoming Country Manager, Michael Stone met with the Minister of Energy and Energy Industries, The Honourable Stuart Young.

The Ruby Field is part of the Ruby-Delaware Field Development in Block 3(a) which will produce oil and natural gas resources using six (6) development wells with peak production rates expected at 16,000 bopd and 80 mmscf/d of natural gas. All development wells are expected to be online at the start of Q3 2021.

The Minister congratulated BHP on their safe operations in these challenging times and discussed certain specific projects that he would like BHP to work on with the government, all designed to secure the future of the energy sector.

According to a release from BHP, Geraldine Slattery, BHP President Petroleum, said, “The startup of Ruby represents continued development of BHP’s oil and gas production facilities in Trinidad and Tobago, and re-enforces the quality of the resource and its investment competitiveness. An Ocean Bottom Node (OBN) seismic survey acquired by BHP and the Block 3(a) partners in 2018, was utilised to illuminate and optimally position the Ruby Project development

BHP’s Angostura Platform wells. This marks a significant milestone for our petroleum business and our future in Trinidad and Tobago.”

BHP Country Manager of Trinidad and Tobago, Michael Stone said, “Achieving first oil safely and ahead of schedule reflects the true tenacity of the Ruby project team together with our industry and Government partners who persevered to deliver this project amid a pandemic. This important

milestone also highlights BHP’s continued commitment to doing business in Trinidad and Tobago as we celebrate 25 years of operations here this year.”

Drilling and completions activities at Ruby are ongoing, with subsequent wells to be placed into production in the second and third quarter of 2021 and project completion expected in the third quarter of 2021.

The Ruby development is a joint venture between BHP (operator: 68.46% interest) and The National Gas Company of Trinidad and Tobago Limited (31.54% interest).

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Peterson loads third and final Christmas Tree for bpTT's Matapal Staff Writer | Energy Chamber PETERSON announced recently that it successfully dispatched and loaded onto the MV Eland the third and final Christmas Tree in support of bpTT’s Matapal project.

“This is a great example of what we do, the benefit of teamwork and ensuring safety is at the forefront at all times,” said Robert MacLean, Peterson Integrated Logistics TT Limited Operations Manager.

Subsea Christmas Trees are a system of valves,

flow paths, piping, and connectors installed on a subsea wellhead to contain and control the flow of fluid from a reservoir or from the surface by injection.

The Matapal project is one of bp’s major projects in Trinidad and Tobago. It will be the company’s second subsea development off the south-east coast of Trinidad. According to bp the Matapal project will develop the gas resources discovered by bpTT in 2017 with the Savannah exploration well. The project will be a three-well subsea tie-back to the existing Juniper platform. The project production

capacity will be 400 million standard cubic feet of gas a day.

TechnipFMC is the major contractor on the project. According to Technip, the project is about 80 km off the south-east coast of Trinidad. The project also features 9km of infield umbilicals tied into existing Juniper infrastructure which will be utilised to supply power, communications and controls to the Matapal production system. Matapal is 8km east of Juniper in 163m of water depth. The Matapal wells tie back to Juniper through 8 inch 100m long flexible

jumpers to a four slot subsea manifold.

From the subsea manifold, dual eight-inch flexible flowlines and risers will transport the hydrocarbons to the Juniper platform and will be tied into the existing topsides production manifold on the main deck. bp has indicated that the project is on track for first gas in 2022.

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Rystad projects peak oil in 2026 due to electrification of transport sector Staff Writer | Energy Chamber THE adoption of electrification in transport and other oil-dependent sectors is accelerating and is set to chip away at oil sooner and faster than in our previous forecast. As a result of this transition, Rystad Energy is downgrading its peak oil demand forecast to 101.6 million barrels per day (bpd), a pinnacle that will come in 2026, earlier than thought, plateauing before falling below 100 million bpd after 2030.

In their updated base case, which they call the 'Mean Case', oil demand will be whittled away mainly by a growing electric vehicle (EV) market.

Aside from the staggering takeover of EVs, assumptions across all scenarios (low-case, mean-case and high-case) see oil demand being either phased out, substituted, or recycled across a range of sectors.

They forecast tectonic shifts — some

sudden and others slowly evolving — in plastics recycling, a growing share of hydrogen in the petrochemical sector, and oil substitution in power, agriculture, and maritime sectors. Other sectors will still see thriving oil demand in the mid-term, such as trucks, maritime and petrochemicals, and aviation in the long term, where they see a sizable substitution of jet fuel with non-petroleum fuels such as bio-jet fuel, which is still part of the overall liquids products universe.

“Oil demand will evolve in three phases. Through 2025, oil demand is still affected by COVID-19 impacts and EVs are still slow to take off, then from 20252035, structural declines and substitution impacts - especially in trucks - take hold, and then finally, towards 2050, the recycling of plastics and accelerated technologies in maritime will be the final transition leg bringing oil demand further down towards 51 million bpd in 2050 in our Mean Case," said Sofia Guidi Di Sante,

Oil Markets Analyst at Rystad Energy.

Road transport (passenger vehicles, buses and freight), which makes up over 48% of oil demand, will be the ultimate driver of the transition. The swiftest transition is already well underway in the electric passenger vehicle sector, which currently makes up 6% of global vehicle sales, but will account for 23% by 2025 and then accelerate towards 96% penetration by 2050.

Trucks, which account for 18% of total demand, will not electrify in the short-term, but when the adoption occurs in the mid-2030s and begins reaching critical mass, the substitution impact will be much higher on a perunit basis compared to smaller vehicles that use less fuel. EV trucks will benefit from the technology groundwork already being established in passenger vehicles.

Buses will also see a gradual transition from petroleum diesel to electric and biofuels. The EV truck market share will

Ruby Project to enhance gas supply to NGC Staff Writer | Energy Chamber TRINIDAD and Tobago can expect to see a healthy boost in its supply of crude oil and greater stability in natural gas production as the Block 3(a) Ruby development project begins production ahead of schedule. Operator, BHP, announced first oil from the development on May 4th, 2021 and first gas is expected to occur shortly thereafter. On completion of all development activities later this year, the Ruby field is expected to produce up to 16,000 gross barrels of oil per day and 80 million gross standard cubic feet of natural gas per day.

The Ruby development is located in Block 3(a) immediately east of the Greater Angostura Field.

Through subsidiary NGC E&P (Netherlands) B.V., The National Gas Company of Trinidad and Tobago Limited (NGC) is a joint venture (JV) partner in the Ruby Project with BHP. In July 2020, NGC and BHP signed a Gas Sales Contract ('GSC') for the sale of 100% of the gas produced from the Ruby field to add to NGC’s existing portfolio of natural gas supply.

NGC, as a joint venture partner, is also entitled to a share of the field’s oil production which will be marketed as part of NGC’s Energy Marketing and Trading portfolio, providing valuable supplemental income to the company.

For NGC President Mark Loquan, the milestone achievement on the Ruby project, together with positive news from other producers, gives cause for optimism.

Loquan said, “NGC has been working closely and conscientiously with upstream operators, both as a value chain stakeholder and joint venture partner in several developments, to advance work programmes and bring more gas into the pipeline.

It is extremely heartening to see that work bearing fruit. The announcement of first oil from Ruby signals important progress on an important project.

We look forward to more positive news from the field and expect associated gas production to give an appreciable boost to our supply over the coming months. This is welcome news for our downstream sector, for our company and for the country as a whole.”

NGC’s investment stake in these upstream projects has allowed the company to deepen its participation along the gas value chain and further its strategic objective of growing the business and its impact within the energy sector.

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rise to 6% in 2025, 21% in 2030, and 61% in 2040.

Petrochemicals, which make up 14% of total oil demand, are expected to grow until at least the mid-2030s as plastics consumption per capita grows worldwide. The demand then peaks as plastics recycling rates converge towards 75-80%, as observed in glass and metals, from the current effective rate of 5%, at the same time as hydrogen-sourced feedstock picks up from less than 1% today to 30% of the virgin petrochemical feedstock for LDPE, HDPE, PP and PVC plastics production in 2030.

Maritime, which makes up 6% of demand, is expected to be dominated by oil for at least through the mid-2030s, after which they expect to see switching to liquefied natural gas (LNG), hydrogen, electric batteries, and other carbonneutral vessels, especially in newbuilds.

This sector already underwent a big transition with IMO 2020, which saw the

switching from high-sulfur fuel to ultralow sulfur fuel.

Aviation, which makes up less than 7% of oil demand, is expected to continue to grow until 2050 as no viable oil substitution technology exists.

The gradual introduction of bio-jet fuel will limit pure kerosene jet fuel demand growth but will not affect the strong upward trajectory in aviation through 2050, unless a viable alternative technology is introduced.

Other sectors (agriculture, energy own use, industry, buildings, and power generation) continue a downward sloping trajectory. Growing agriculture and energy own use demand partially offset the accelerated decline of oil consumption in power.

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Energy Services Sector Survey Q1 2021

Companies continue to report value and volume of business below normal Staff Writer | Energy Chamber FIFTY-TWO per cent of energy services companies polled by the Energy Chamber indicated that the value of their business was down in the first quarter of 2021. Seventy-three per cent of the respondents indicated that this was due to less business opportunities.

Fifty-two per cent of respondents also indicated that the volume of their business was down in the first quarter of 2021. Eighty-six percent of respondents indicated that this was also due to less business opportunities being available to them.

Overall, a vibrant energy services subsector is integral to the health of the energy sector. With more than half the contractors polled indicating that the value and volume of their business is down, this certainly paints an alarming picture of this sub-sector.

The Energy Chamber’s Energy Services Sectors Survey (ESSS) is a quarterly survey of energy services contractors which allows for such an assessment. The ESSS attempts to map the performance and optimism of our energy services sector members, providing data on their business confidence and on some of the phenomena which impact on their operations and business prospects.

The survey draws on information from survey participants such as the

Value of Business

Volume of Business

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level of confidence of service contractors and the value and volume of business in the current quarter as well as what they project for the next quarter.

Capital expenditure (CAPEX) CAPEX authorisations over the next quarter, according to the survey, suggest that most respondents are seeking to reach and engage new clients (46%). In addition, respondents indicated that they would increase efficiency and exploitation of new technology (33%). When asked what factors would limit their capital expenditure authorisations over the next 12 months, 92%. of respondents indicated that it would be uncertainty about demand/business prospects.

Below Normal

Looking forward The next quarter is not holding much promise for an increase in the volume of business. Fifty-nine per cent of the energy services companies polled reported that in the next quarter (Q2 2021) they expected the volume of their business to be below normal.

The energy services sector remains a viable source of employment. However, due to the uncertainty in demand in Trinidad and Tobago, the energy services sector is facing its share of challenges and decline in opportunities available.

Above Normal

Normal

Below Normal

Why is the value of your business in this quarter below normal?

80% 70% 60% 50% 40% 30% 20% 10% 0% Less business opportunities

Loss of contracts

Decreased demand for services

Other Decreased average selling prices

Forced to offer fewer services

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'Stena Carron' serviced in T&T waters Staff Writer | Energy Chamber THE Stena Carron is one of the most iconic drillships that has been used in Exxon’s drilling campaign in Guyana and Suriname. The vessel was the responsible for drilling the Liza well which reignited global interest in the southern Caribbean.

The Stena Carron is a 6th Generation Harsh Environment dual-activity dynamically positioned drillship, capable of drilling in water depths up to 10,000ft.

Recently the vessel spent 10 days in Trinidad and Tobago's waters to undergo maintenance and repairs.

Trinidad and Tobago's geographical location has positioned it as the ideal hub for the thriving oil and gas industry in the southern Caribbean, with major opportunities to provide services for the growing drill rig fleet operating offshore Guyana and Suriname.

Ramps Logistics, supported the Stena Carron as it entered Trinidad and Tobago's waters to undergo maintenance and repairs. Ramps collaborated with the local authorities and a host of local businesses to ensure the Stena Carron successfully completed it maintenance and received the necessary services required safely and in adherence to the COVID-19 regulations.

To continue to support operations such as these, Ramps has invested in a multi-million dollar supply base in Chaguaramas, designed to support logistics operations in the southern Caribbean.

According to Ramps, while geography works in our favour, “Location is not enough. There must be an environment and economy that encourages investment from these energy companies to utilise Trinidad and Tobago's resources for their vessels.

Collaboration is key between the public and private

Stena Carron while in T&T’s waters Photo Credit: Ramps Logistics sectors. Companies, governments, and ministries need to work together to ensure critical offshore operations continue, despite the setbacks that may arise due to the pandemic.”

The traditional ways in which vessels were handled have been challenged due to the ongoing pandemic. Ramps said, “The Ministry of Health and The Ministry of National Security stepped up

to work hand in hand with all parties involved to develop the protocols and procedures necessary for the safety of both the Stena Carron and its stakeholders.”

The company also added, “The support, creativity and willingness from the ministries facilitated safe trade during these challenging times. By adhering to proper procedure, this project

occurred efficiently and without any threats to the health of the parties involved. The success of this project will now set a standard to ensure opportunities for operations like these come to Trinidad and Tobago in the future.”

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DNV updates carbon capture and storage (CCS) recommended practice as the energy transition picks up the pace Staff Writer | Energy Chamber DNV has published new procedures designed to provide the required safety level in transporting CO2 by pipelines and strengthen the development of carbon capture and storage (CCS) projects. This follows the outcome of the CO2SafeArrest joint industry project (JIP) between Energy Pipelines CRC (Australia) and DNV. The work has been supported by the Norwegian funding body CLIMIT and the Australian Commonwealth Government under the Carbon Capture & Storage Research Development and Demonstration Fund.

The need to transport CO2 is expected to increase significantly in the years to come as part of the widespread view that CCS is a viable means to reduce CO2 emissions. Reliable transport from where it is captured to a storage site is therefore of utmost importance.

An updated recommended practice (RP), DNVGL-RP-F104 Design and operation of carbon dioxide pipelines, has been published based on the results from the CO2SafeArrest JIP, resulting in a new empirical model for the assessment of running ductile fractures in CO2 pipelines.

The JIP involved two large-scale

CO2 crack arrest tests being carried out on 24 inch pipelines to better understand the safety implications of CO2 releases.

The testing was performed at the DNV Research and Development facility in UK. The RP can also be used alongside DNVGL-ST-F101 Submarine pipeline systems.

Hari Vamadevan, Regional Director UK & Ireland, Senior Vice President with DNV’s Energy Systems business area, states, “We are seeing globally the drive from industry and governments to proceed with CCS and all major routes to successfully decarbonising gas rely on the large-scale uptake of the technology.

This RP gives guidance to the industry to contribute and ensure that safe and reliable operations continue to take place as CCS begins to scale worldwide. It also supports the fact that the re-purposing of existing infrastructure can be carried out safely in the future.”

Transport of CO2 can be done either through the use of existing pipelines or the construction of new pipeline systems.

DNVGL-RP-F104 is supporting both the design of new pipelines and the reuse of existing infrastructure by describing a process of how to requalify the pipelines for CO2 transport through various steps.

Requirements for requalification is

primarily identified through a change of medium in the pipeline, for example, from natural gas as in the original design, to CO2.

Both for new CO2 pipelines and requalification of existing pipelines, the operators of the pipelines need to fully understand the threats, failure mechanisms, consequences and probabilities of pipeline failures in order to ensure that they are operated safely.

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TTNGL profitability for Q1 2021 improves by 622% Staff Writer | Energy Chamber

NGC Head Office

FOLLOWING a year of upheaval in global economic and energy markets, Trinidad and Tobago NGL Limited has shown significant rebound and recorded an after-tax profit of TT$50 million for the first quarter of 2021 when compared to the first quarter of 2020, which recorded TT$6.9 million. The upturn in profits translates into earnings per share of TT$0.32 for shareholders compared to TT$0.04 for the same period last year.

Chairman Conrad Enill noted in his report for Quarter 1 2021, TTNGL’s improved profitability was because of a higher share of profit from its underlying asset Phoenix Park Gas Processors Limited (‘PPGPL’). PPGPL’s enhanced performance was driven by higher Mont Belvieu prices for Natural Gas Liquids (‘NGLs’), which were 49.8% above the first quarter of 2020. This trend began in Quarter 4 2020 and continued into Quarter 1 2021, as markets recovered from the effects of the COVID-19 pandemic.

PPGPL’s profit is also reflective of a 7.1% improvement of NGL production from gas processing through deliberate efforts by The National Gas Company of Trinidad and Tobago Limited, with an 11.9% increase (versus 2020) in NGL content in the natural gas stream.

Additionally, PPGPL has successfully advanced its marketing efforts to renew key sales contracts for the lucrative Eastern Caribbean market. Advances have also been made in furthering the product trading strategy which delivered a significant economic return in the first three months of 2021.

PPGPL’s robust performance was bolstered by the operations of its North American subsidiary, Phoenix Park Trinidad and Tobago Energy Holdings, which contributed approximately 8% of PPGPL’s profit after tax. PPTTEH experienced high trading volumes and benefitted from improved margins derived from the contracts with its counterparties. Earnings from this business segment are expected to continue to contribute positively to PPGPL’s future results.

Moreover, the outlook for PPGPL and TTNGL continues to show

NGC's Chairman Conrad Enill

TTNGL’s improved profitability was because of a higher share of profit from its underlying asset Phoenix Park Gas Processors Limited (‘PPGPL’). favourable trends, despite the persistence of short-term volatility arising from the uncertain impact the pandemic may have on regional and international NGL markets. Mr. Enill noted, “PPGPL has been resilient in managing the effects of the pandemic by retaining its markets, maintaining high levels of plant reliability and availability, as well as high customer satisfaction indices. These efforts, coupled with PPGPL’s continued drive for strategic value creation initiatives and opportunities, will underpin the development of long-term shareholder value.”

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Methanex plant in Trinidad

Methanex reports strong first quarter results Higher production at Atlas plant than previous quarter Staff Writer | Energy Chamber FOR the first quarter of 2021, Methanex reported net income attributable to Methanex shareholders of $105 million ($1.19 net income per common share on a diluted basis) compared to a net loss of $27 million ($0.35 net loss per common share on a diluted basis) in the fourth quarter of 2020. Adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the first quarter of 2021 was $242 million and adjusted net income was $82 million ($1.07 adjusted net income per common share). This compares with adjusted EBITDA of $136 million and adjusted net income of $12 million ($0.15 adjusted net income

per common share) for the fourth quarter of 2020.

Methanex increased the average realised price in the first quarter of 2021 by $81 per tonne, to $363 per tonne, compared to the fourth quarter of 2020.

According to the company, steady methanol demand recovery and lower industry operating rates, supported higher methanol prices. Strong methanol demand combined with low global inventory levels and ongoing industry supply challenges continue to drive tight market conditions into the second quarter of 2021.

In terms of production, the first quarter of 2021 was similar to the fourth quarter of 2020.

However, higher production at the Atlas and

Medicine Hat facilities offset lower production at the New Zealand and Geismar facilities.

John Floren, President and CEO of Methanex, commented, “We are pleased to see favourable industry conditions continue through the first quarter with positive momentum leading into the second quarter. We are cautiously optimistic that manufacturing activity will rebound and the economy will fully recover in the medium term as vaccine rollouts accelerate and as governments announce additional fiscal support measures.

For now, we continue to prioritise liquidity and financial flexibility to best position ourselves to deliver long-term shareholder value.”

Trinidad produced 275,000 tonnes (Methanex

interest) during the first quarter of 2021 compared to 161,000 tonnes in the fourth quarter of 2020.

The company stated that production levels in Trinidad were higher in the first quarter of 2021 compared to the fourth quarter of 2020 as the planned turnaround at the Atlas facility impacted production in the fourth quarter of 2020.

Based on current gas deliveries, Methanex estimates that Trinidad production in 2021 is approximately 1.1 million tonnes (Methanex interest).

Titan remains idled indefinitely.

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BPC update on activities in Suriname — well to be drilled in July 2021 Staff Writer | Energy Chamber BPC's 2021 work programme in Suriname includes drilling of an appraisal well and conducting of an extended well test (EWT) at its Weg Naar Zee (WNZ) PSC in which BPC has a 100% working interest.

In support of this, a number of workstreams have already been completed, including: approval from Staatsolie to proceed with the drilling programme, approval from NIMOS (the environmental regulator), the well site has been scouted, various in-country contractors and well equipment have been sourced, a local agent has been engaged, and rig tenders which are

currently being evaluated, have been received from three suppliers.

The company has indicated that it is ready to proceed with drilling, although operational challenges arising from the COVID-19 situation in Suriname have resulted in the decision to move the projected well spud date to July 2021.

The Suriname well has been designed to appraise the producibility of oil at the WNZ project. The WNZ field is an existing discovered oil field with over 70 existing shallow wells and 114 km of 2D seismic. The oil is located in eight separate pools and has been estimated to hold up to 24.1 MMbbls of oil in place. The first well will target the largest of these pools with a twinning of

an existing successful production well to a total depth of less than 1,000 ft. This well is expected to take around 10 days to complete and has an estimated cost of US$0.6 million.

On a successful Suriname well and EWT, the forward work programme for the balance of 2021 includes drilling a further four production wells (subject to permitting and rig and capital availability), with field development drilling continuing thereafter, through 2022 to 2024. The current estimated overall field development would comprise up to approximately 50 wells in total, with peak production projection of approximately 900 to 1,000 bopd. A successful WNZ initial field development

of four additional production wells is projected to produce around 100 bopd which, based on a US$60 / bbl oil price, would result in incremental cashflows to BPC of $1 m per annum. For context, the current full WNZ field development scenario would generate annual net incremental cash flows for the company in excess of US$2.5 million based on the same oil price assumption.

BPC undergoes corporate reset; company to rebrand as Challenger Energy Group BPC announced recently that the company will undergo a corporate reset. Eytan Uliel, current Commercial Director, will become the company’s new

Chief Executive Officer (CEO) and Simon Potter (current CEO) will transition to a non-executive director role, effective May 20.

Uliel, indicated in a recent interview that the company which was primarily focused on the Bahamas, has acquired assets in four countries and the decision was taken to rebrand, in an effort to reflect the company's current portfolio.

The company currently has interests in The Bahamas, Trinidad, Suriname and Uruguay.

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SVG relief vessels: 'Sentinel', 'Atlantic Spirit', 'Salima K' and 'Explorer' Staff Writer | Energy Chamber

The Mid Atlantic Sentinel — One of the vessels used in the relief effort to support St Vincent and the Grenadines

IN April 2021, the energy sector in Trinidad and Tobago mounted an impressive collaborative relief mission to St. Vincent and the Grenadines in response to the crisis caused by the eruption of the La Soufriere volcano. The efforts were coordinated through the Energy Chamber of Trinidad and Tobago. In the immediate aftermath of the eruption, the direst need for a water supply to the island was identified and the ability of platform supply vessels from the Trinidad and Tobago offshore oil and gas industry to supply potable water in large volumes was identified as a quick potential solution. An immediate dialogue was initiated by the Energy Chamber and major oil and gas operators willingly came on board. They in turn sanctioned the assistance of their supply partners.

The first vessel to depart was the Sentinel owned by Mid Atlantic Ltd., which not only delivered 25,000 gallons of potable water to Kingstown, but also organised the delivery of water tanks and potable water to coastal towns and villages that had been cut-off and without water for days.

The Atlantic Spirit owned by Inland and Offshore Contractors Ltd, was the next vessel to depart taking 120,000 gallons of potable water in this under-deck tanks and 30 pallets of donated bottled drinking water and other relief supplies on deck. Following shortly behind the Atlantic Spirt was the Salima K., owned by Esskay Contractors Ltd. with over 30 pallets of bottled water and 25,000 gallons under deck for delivery.

The potable water was pumped out from the vessels into the water storage tanks setup on the port in Kingstown for onward transmission to the emergency shelters through road tanker wagons.

The final vessel that took part in the relief mission was National Energy’s Explorer who also transported potable water below deck and a large number of other relief supplies, in particular mattresses and sleeping cots for emergency shelters.

This relief effort involved a huge amount of coordination and communication amongst the industry partners and volunteer services from across the industry. BHP, EOG and bpTT provided funding to cover part of the costs of the first three vessels, while Ramps Logistics provided all of the logistical support and funded all of the testing required to comply with COVID-19 protocols. Ernst and Young, Capital Signal, Rig Bound, Pier 1, Bartlett Haulage and Wafiqu's Transport also joined this effort. The team kept in constant communications with the Trinidad and Tobago Office of Disaster Preparedness and Management (OPDM), St. Vincent Chamber and port authorities.

The energy sector was not the only sector providing assistance to St. Vincent. The joint chambers of industry members provided donations of relief supplies which were delivered to the OPDM for transport via the Galleons Passage. That effort received significant support from many local manufacturing companies, which donated many of the relief items requested by St. Vincent. Members of the Energy Chamber, AmCham and the T&T Chamber also made very generous cash donations which were used to procure relief supplies, including pumps, generators, plumbing supplies and mattresses.

Major cash donors included Atlantic, DC Power, E-Couriers, GISCAD Limited, Industrial Welding Equipment Sales & Rentals Limited, Nutrien, Perenco and Rose Environmental, along with a number of individual and anonymous donors.

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On board the Sentinel – Pumping water to shore (Photo: Mid Atlantic)

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regional

| May 2021 energy.tt • @ttenergychamber

Jamaica utility cracks down on electricity theft Staff Writer | Energy Chamber THE Jamaica Public Service Company (JPS) says that it welcomes the search for innovative solutions to address the widescale and growing problem of electricity theft plaguing the country. With just over 18% of electricity generated annually being lost due to non-technical reasons, primarily the theft of service, the Company says the focus on solutions is timely; as the country prepares to develop a National Loss Reduction Plan (NLRP) to determine roles, responsibilities and actions for the near to medium term.

“It is tremendous to see this public interest in finding solutions to electricity theft. The ideas coming forward are a recognition that this issue affects us all.

It is a major national problem that demands urgent and collective action. This is a spreading crime that has strong roots in both a feeling of impunity and the difficulty by some Jamaicans to afford basic services. To make progress, we have long advocated for resolute public-private partnership,” said JPS President and CEO Michel Gantois.

His comments come following public discussions prompted by a recommendation from the Parliamentary Opposition, for the installation of individual solar photovoltaic systems to reduce the loss of electricity to an estimated 150,000 to 200,000 illegal users of power from the national grid.

Mr. Gantois noted that, “Electricity theft is a complex problem that requires many different solutions that address the several reasons contributing to the problem, while highlighting that first and foremost, strong and effective enforcement of the rule of law will be required for all solutions to be sustainable. We need immediate programmes that assist those who are vulnerable and genuinely need help and keep a promise of swift and harsh penalties for the hardened and unrepentant thieves, and solutions that are fair to the thousands of Jamaicans who, often under difficult circumstances, diligently strive to live up to their commitment.”

The JPS CEO says that these are good guiding principles for all stakeholders to work with, in forging a plan to address the danger that electricity theft poses to the viability of the electricity grid. He encourages civil and special interest groups and all Jamaicans to join in offering recommendations and proposals to tame the monster of electricity theft.

JPS continues to fight against theft using several methods, including the removal of illegal wires, the use of smart devices to detect concealed theft and community intervention, through its Community Renewal Department.

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| May 2021

opinion

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Regional threats and opportunities Dax Driver Energy Chamber CEO @dax_driver

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Drilling rigs off the coast of Trinidad in January 2020

Is there a future for energy in Trinidad and Tobago?

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VER the past few months, there has been a lot of commentary in Trinidad and Tobago questioning whether or not the country’s energy industry has a future. The spectacular rise of the oil industry in Guyana and the exploration success in Suriname has shifted the centre of gravity for Caribbean hydrocarbons south-east, while the climate change and the urgent need to decarbonise the global economy has people worried if hydrocarbons have much of a future at all.

The oil, gas and petrochemical sectors have been the backbone of Trinidad and Tobago’s economy ever since the nation gained independence. The country’s success in the sector allowed it to become the most developed country in the Caribbean, with the highest levels of per capita income and significant government revenue.

This success was not guaranteed by the mere presence of hydrocarbons in the country’s subsurface geology. There are plenty of examples of countries around the world that have not managed to turn their hydrocarbon resources into aboveground revenue. This is especially the case with natural gas reserves, which many nations without existing industrial demand have found difficult to successfully monetise. Trinidad and Tobago certainly has a good story to tell, and over the years many people have been interested in understanding how the country achieved its success. But past success is no guarantee of future success, and the clear feeling among many people in the country is that the glory days are in the past.

While the immediate circumstances make this lack of confidence in the future understandable, they underestimate the significant potential that the country still holds. As BHP’s exploration success in the Atlantic waters east of Tobago clearly show, there are still significant resources to be found.

As a deepwater gas development, the Calypso project is certainly going to be a challenging one to successfully execute, both technically and financially. But Trinidad and Tobago has

shown itself able to successfully develop projects in the past; we should not forget that the Atlantic LNG project was certainly a ground breaking project back in the 1990s.

While the energy transition clearly means that renewable energy sources will grow most rapidly, this does not mean that gas does not have a long-term future. Most scenarios predict that natural gas is going to remain as an important fuel for electricity generation for decades to come, as well as a feedstock for petrochemical production. In some markets, especially Europe, there is likely to be an increasing demand for greener petrochemicals and lower carbon liquefied natural gas (LNG). Trinidad and Tobago has an opportunity to green our petrochemicals, especially with the addition of hydrogen from renewable or low carbon sources, as well as lower carbon LNG through improved energy efficiency and potentially offsets (for example, through carbon capture and sequestration).

In addition to the potential of carbon capture and sequestration, enhanced oil recovery using carbon dioxide (CO2) also presents a significant opportunity to revitalise the traditional oil industry. There are still significant volumes of oil in existing reservoirs, and the potential for new finds in traditional areas should also not be discounted as the recent Touchstone onshore exploration success clearly indicates.

While there are clearly still opportunities to extend the life of hydrocarbon production in Trinidad and Tobago, the real strength that the country has, is not in its geology but rather in the ability of the people and the companies involved in the industry. Trinidad and Tobago has always put a lot of resources into human development, and there are large numbers of well-trained energy sector professionals and skilled workers both working in the country and in the industry around the world. There are also a large number of service companies with significant expertise. These individuals and companies will ensure that the industry has a future, even while the sector undergoes significant transformation.

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President and Chief Executive Officer: Dr. Thackwray ‘Dax’ Driver Business inquiries: P (868) 6-ENERGY • F (868) 679-4242 . dax@energy.tt Suite B2.03, Atlantic Plaza, Atlantic Avenue, Point Lisas, Trinidad and Tobago

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HE eruption of the La Soufrière volcano in St. Vincent in April 2021 was a vivid reminder of the threats of natural disasters that face us in the Caribbean region. It was also a reminder of both the resilience of our people and how well the regional private sector can pull together and deliver support and relief in the face of disasters. The outpouring of support from individuals, non-governmental organisations and companies across the region has been impressive.

Through my current role as Chair of the Caribbean Chambers Network (CARICHAM), I have been in the midst of this response effort. The importance of CARICHAM in the response cannot be underestimated. It allowed the executive directors of all of the Chambers in the network to be in regular contact with the St Vincent Chamber and to make sure that our private sector members, who wanted to contribute to the relief efforts, were able to respond to actual needs and to help with the coordination and delivery of needed items.

As with every disaster, the relief efforts can be hampered by well meaning but ultimately troublesome donations of items that are not a priority and which clog the relief distribution programme. Communicating this reality to stakeholders is not always easy, but having firsthand reports from some of our members, such as the Dominica Association of Industry and Commerce, on the challenges that unsolicited donations of relief items have created in the past, has helped with that communication challenge.

Chambers of Industry and Commerce have played a key role in communications and ensuring that people making donations work in close coordination with the regional disaster response system, through national disaster response agencies. I have been privileged to sit-in on the regular coordination meetings organise by the Caribbean Disaster Emergency Management Agency (CDEMA) in response to the St. Vincent volcano crisis. This has given me a new appreciation of the work that they do to make sure that both regional and international relief agencies are properly coordinated to effectively manage the crisis. With the complication of the COVID-19 pandemic, this coordination is even more crucial and challenging.

The response of our member companies in the Trinidad and Tobago energy sector has been tremendous. It has also again highlighted to me the often-overlooked capacity that exists in the regional private sector and the enhanced role that we could play in both disaster response, but more generally the sustainable development of the region.

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In the immediate aftermath of the first major eruption, we learnt from the St. Vincent Chamber that the most immediate problem that the country faced was access of potable water as the water distribution system had to be shut down to prevent permanent damage from the volcanic ash. The Trinidad energy sector can deliver large volumes of potable water quickly, utilising platform supply vessels that often deliver water to offshore oil and gas platforms and rigs. We were able to very quickly mobilise the local companies that owned vessels, and with the support of some of the major operating companies, we quickly dispatched vessels loaded with potable water to St. Vincent. This provided much needed urgent access to potable water.

One of the vessels, the Sentinel, owned

by Mid-Atlantic, not only delivered potable water from Trinidad to St. Vincent, but they also organised the delivery of water within St. Vincent as well. The vessel took water tanks from Kingstown to the town of Barouallie, which had been without water for five days, and then filled these tanks with water pumped from its underdeck potable water tanks, returning a few days later to do the same process again. This was a reminder that the Trinidad private sector has significant logistical capacity in the energy services sector, in addition to engineering and project management skills.

This is a point that I have been making in my conversations with CDEMA and encouraging them to look to the regional private sector as not simply a provider of relief items postdisaster, but also of services. There is always a tendency to overlook the supply of services in regional discussions, just as there is a tendency to overlook services trade in regional policy discussions around the CARICOM Single Market and Economy (CSME). The strengths of the Trinidad private sector in energy services could be of huge benefits to the wider Caribbean region, not just in post-disaster scenarios but to also help the region through the energy transition. One of the positives that may come from the St. Vincent volcano crisis is greater recognition of the importance of services and the potential of services trade within CARICOM.

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Disclaimer: Except for the editorial on this page, all opinions are those of the authors or interviewees and do not necessarily reflect the views of the Energy Chamber.

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opinion

| May 2021 energy.tt • @ttenergychamber

Optimising teams for disruption Professor Sterling Frost | Contributor

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trademark of an agile organisation is a network of empowered teams. A team can be considered a sociocultural system; where the system is a collection of interrelated parts working together for a common purpose. The sociocultural subsystem exists within a larger ecological context with its own unique subculture, i.e., the DNA of the system. Aside, evolutionary psychologists and biologists proffer that teamwork was integral to our ancient survival, naturally embedded in our psyche in response to incremental changes in the environment. Yet, as natural as teamwork is, there is still some room for artificially optimising teams in the modern context of rapid change and the Fifth Industrial Revolution (5IR). This article offers a few approaches to workplace teams and proposes a framework for optimising team effectiveness.

Teams in Organisations Formal teams have distinct roles that are created by design through the organisation’s governance systems; and over time, group norms can emerge which influence the effectiveness of the team. Teams can also emerge organically with no distinct hierarchy and leader due to natural affinities and/or the need to respond to some problem or feedback from the wider system. Such formations can reinforce subcultures in the organisation with both positive and negative outcomes. Both formal and informal teams, just like any system, can be assessed on different dimensions, i.e., who should comprise your team; how to increase team effectiveness; and when to apply the strategies and tactics for effectiveness.

Figure 1 - Belbin’s 9 Team roles

The Who (roles and members) dimension The right balance of competencies and personalities on a team are more crucial than having the most competent persons. For the individual team member, a single competency comprises knowledge, skills and behaviours that interact to give rise to effectiveness.

Competency models classify competencies as core, technical, cognitive and/or behavioural. An example of a cognitive competency would be conceptual thinking, while a behavioural competency example is customer orientation. Competency models, used in Strategic Workforce Planning (SWP), should also be used in selecting and balancing teams. A competency can emerge at a team level, where it may not exist at the individual level.

Raymond Belbin, researcher and management consultant suggests that identifying individuals’ strengths and areas for improvement within a team, using a matrix of nine clusters of behaviours which are mapped to archetypical roles can be a useful tool to increase overall team effectiveness.

Understanding personality styles is also important and useful for assessing team members. The DISC

Figure 2 - Team Development: adapted from various sources model (Dominance, Influence, Supportive and Conscientiousness) and the Myer-Briggs Type Indicator (MBTI) are useful tools in this regard. MBTI measures individuals on four spectrums to determine one of 16 personality types (Introversion/Extroversion, Sensing/ Intuition, Feeling/Thinking, Judging/Perceiving).

Each of the 16 types give rise to distinct inclinations.

Awareness of individual inclinations, strengths and weaknesses can be used to calibrate the composition of the team, as well as, for the design of team building activities.

The How (Creating Effective Teams) dimension Once you have selected and balanced your team, it’s time to optimise its potential. Consider a bottomsup approach to motivating teams; i.e., start with motivating the individual as opposed to broad-brushing motivation, which may have counterintuitive effects.

Approaches include Maslow’s Hierarchy of Needs, leveraging motivating factors (recognition, meaningful work) vs hygiene factors (salary, working conditions).

Once individuals’ needs are being met, team building can be used to motivate teams collectively. Team building exercises involve some collaborative task with the objectives of engagement, building relationships, clarifying roles and understanding team dynamics.

Team building activities can range from in-house facilitated to outsourced retreats.

Alignment to strategy is critical. Teams can develop a greater sense of purpose by seeing how they fit into a wider system. Borrowing from Peter Senge, personal mastery and team mental models should be aligned to the shared vision of the organisation. This alignment can be achieved via cascading of goals. McKinsey suggests teams set their own team level (role weighted) objectives, in addition to individual targets, which can result in empowered, agile and cohesive teams.

The When (time) dimension Organisational psychologist Bruce Tuckman proposed the widely accepted model of team development which consists of five stages: forming, storming, norming, performing and adjourning. Figure 2 summarises the descriptions of these phases and its application.

The stage of team development should guide choosing and calibrating the various tools and techniques used for further development and boosting team effectiveness.

A Framework for the Future The 5IR sits atop the technological acceleration and human-system integration of the 4IR; however, the 5IR reverses the trend of dehumanising innovation. A greater emphasis will be placed on humanity, increasing labour productivity, and mass customisation of products and services. The implications on team effectiveness are significant and include: 1. Competency models will require continuous reskilling of employees with a greater need for group agility, empathy and learning in order to facilitate customised innovation.

2.

Utilisation of artificial intelligence in recruitment to profile and match individuals to teams and also to replace certain team roles.

Once you have selected and balanced your team, it’s time to optimise its potential. Consider a bottoms-up approach to motivating teams; i.e., start with motivating the individual as opposed to broad-brushing motivation, which may have counterintuitive effects.

3.

Team dynamics disrupted by remote work, constant changes to operating models and demographic shifts in age, gender and nationality.

Given the imperatives of the 5IR, here is a framework for optimising team effectiveness: 1. In developing teams: a. Profile team members to determine the roles they are best suited for. b. Juxtapose the combination roles required over the phases of team development with individual inclinations. Use this to develop the dynamics of how resources are assigned and leveraged to optimise their usage and team performance. c. Utilise various team building, motivation, coaching and learning tools and techniques, calibrated to the lifecycle and composition of the team.

2.

Aligning the team, team learning and competencies to: a. The demands of the 5IR; b. The strategy of the organisation by ensuring team goals are defined and incorporating long-term team development in SWP; c. The desired organisational values; i.e., avoid undesirable subcultures from emerging while still allowing the team to retain a sense of identity.

3.

Underlying principles — Systems Thinking: a. Pay attention to and make use of informal teams; often these teams emerge as natural responses to the environment; e.g., mirroring patterns of the 5IR. b. Harmonise team goals with those of other teams for optimal co-creation of value. c. A network of teams should be thought of as a meta-team, where the same concepts above can be applied to wider cross sections of the organisation.

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opinion

| May 2021

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The future of work

The Impact of Industry 4.0 Graham King | Contributor

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HAT is unfolding around the world at the moment, in industry and every sphere of society, is epoch-changing. We are in the midst of two seismic shifts at the same time: the energy transition and digital transformation. These two are overlaid with a pandemic that is the most disruptive happening in 80 years. The pace of change is unprecedented. The future of work is different to the past in fundamental ways; right now we are on the watershed between how it was and how it will be, and the COVID-19 pandemic has given us an emphatic shove into the new dispensation of things.

Industry 4.0, or the Fourth Industrial Revolution (I4R), is so called because it ushers new realities to the industrial and manufacturing arenas. It could be seen as the specific application of digital transformation to industry and includes a suite of technologies that change the way that work is done. It also comes with a philosophy, which is that a highly connected world changes the relationship between producer and consumer, between supplier and customer. It is the 'convergence of the physical, digital and biological worlds' (KPMG, 2020). In the Third Industrial Revolution, machines replaced manual labour and repetitive tasks, and humans and machines were kept separate for safety's sake. In I4R, machines replace human thought and judgement, and humans and machines work together in cyber-physical systems.

Production facilities and products become self-aware through distributed, smart sensors constantly acquiring and returning data (the Industrial Internet of Things).

With your production facilities and your products talking back to you, your operations become much more efficient, agile and relevant to customer needs.

I4R disrupts the foundation of existing business models and demands that companies and people become very different.

New skills are being rapidly established and promoted as of primary value to support this radical transformation. New approaches to work are being demanded by the changing context. 'Going to work'

is becoming a fluid concept as organisations give employees the option of permanent work-from-home arrangements. Some are even permanently closing their offices and reverting to using ad-hoc shared workspaces in place of permanent locations. After our children and students have spent a year-and-a-half doing all their education remotely online, whether or not they have been enjoying the experience, virtual learning will now be a reality for them right through their lives.

In the energy sector, the acquisition, management and analysis of data has become critically important. A future of lower demand for oil and (possibly) natural gas means that the operations that will survive are those that are being made most efficient. Engineers are specifying or designing sensing devices that return much more granular, real-time data on the state of equipment. They are using drones for inspections and interpreting the captured images using artificial intelligence methods to spot potential problems before they become disasters. Technicians are becoming capable of installing, calibrating, connecting and maintaining these devices. IT specialists are being required to secure vast quantities of mission-critical data. Managers are learning how to accelerate decisionmaking using a much more vast suite of available data, to define the analytics that provide relevant insights for those decisions, sort the wheat from the chaff, and trust the data. Formula 1 motor racing is an advanced case study of the I4R in operation in which vast quantities of data are collected and analysed. One of its most

A virtual reality display at the Trinidad and Tobago Energy Conference

successful team bosses, Toto Wolff, said, "It is not just about collecting a massive amount of data; it's also about making sure you know what to do with it so it doesn't just become more noise in the garage. The more data you collect, but more importantly the more you are able to digest and analyse data, the better you will have your car and driver perform"1 Everything that happens in the physical realm is being replicated in the virtual realm in the production unit's 'digital twin'. The fidelity of modelling and simulation has come on in leaps and bounds in the past 20 years, and the digital twins that are emerging today are tuned by real data fed into the models from the vast array of sensors. Engineers today need to be just as comfortable using virtual systems as they are using physical systems. The urge to start 'fiddling', solving problems using trial and error, the most natural thing for many practical people, is the enemy in the Digital Age. Always start with the model. Plan in the virtual domain and try out all sorts of scenarios and explore sensitivities before implementing a solution on the hardware. But do it fast! There is no time to lose if the all-important production efficiency is to be maintained.

Augmented, virtual and mixed reality (XR) are important technologies in the I4R suite. Incredibly empowering, XR accelerates learning of new skills and minimises the need for the user to learn or retain information. All the information that a user needs is presented to them directly, often holographically overlaid on the physical environment, in a head-up display. Applications of XR are numerous, for instance, in supporting maintenance tasks in production facilities.

Operators on a production line are being rapidly upskilled by using XR that presents far more detailed information about equipment; it guides them towards appropriate maintenance actions; it shows which parts to pick from an inventory; it specifies the setting on manual valve based on real-time data provided by a SCADA system. Mechanical and electrical technicians are rapidly cross-trained and function with greater agility in their functions. The ergonomics or packaging of elements of production facilities are thoroughly

investigated and potential problems avoided before designs are finalised.

Blockchain is an I4R technology that is most commonly associated with Bitcoin and other digital currencies, but it is also very applicable to secure business-to-business supply chain transactions. It is a key to the automation of contract and purchasing which revamps business processes and the jobs of professional support staff in companies, so it is not just technical employees who are affected by I4R. Comprehensive rethinking is underway in every aspect of how companies are doing business.

Digital transformation is a democratising force, allowing access to markets and human resources that would otherwise be out of reach for our developing nation island companies and individuals, especially with the rise of the gig economy. It could also have outside players compete with local companies more easily. Digital transformation requires collaboration.

No company has all the skills and resources internally that are required to compete effectively in the new landscape, nor do we have everything we need in the region. Partnerships are necessary between companies with aligned or complementary elements to acquire technology and capability.

I4R is redefining the relationships between humans, technology and data and redefining how work is done, and the skills that are needed, in the process.

It does not downgrade the role of the human. On the contrary, in most cases, humans must interact in more sophisticated ways with the other elements. But the skills required now are different, and more diverse.

Great opportunities exist for enhanced productivity, but the technology and data must be very effectively utilised by the human element.

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<https://www.zdnet.com/article/formula-1-how-sensor-

technology-is-changing-the-race/

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opinion

| May 2021 energy.tt • @ttenergychamber

Investments have been made in renewable energy, energy efficiency and energy education projects.

Embracing green is good for the planet, but also good for business.

Preparing for the era of hydrogen Mark Loquan | NGC President

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S far as fuels go, hydrogen is among the cleanest you can find. As the world attempts to balance growing energy demand and the need to reduce greenhouse gas (GHG) emissions, a fuel whose sole by-product when consumed is water can be a game-changer.

Of course, a fuel is only as green as the process used to produce it, and not all hydrogen is created equal.

Most of the hydrogen produced today is considered ‘grey’, because it requires fossil fuel inputs such as natural gas or coal. ‘Blue’ hydrogen is produced using similarly non-renewable inputs, but carbon capture during production reduces its carbon impact. ‘Green’ hydrogen is cleaner still. Produced using renewable sources of energy, it is the most climate-friendly option.

It is therefore small wonder that green hydrogen is today the subject of increasing investment and policy attention around the world. Almost weekly, news breaks of new projects or government strategies to accelerate deployment of this fuel. Goldman Sachs estimates green hydrogen could supply up to 25% of the world’s energy needs by 2050.1 Investment in its production is projected to exceed US$1 billion a year by 2023.2 Then in December 2020, the ‘Green Hydrogen Catapult’ initiative was launched by seven global energy companies, to increase green hydrogen production 50-fold by the year 2026 and halve the current cost of hydrogen to below US$2 per kilogram.3 What this all means is that green hydrogen and derivative fuels could soon be competitive enough to displace a share of the fossil fuels consumed by pollutant sectors, such as transportation and metals manufacturing. This is a most welcome prospect as we move closer towards our deadline for bringing carbon emissions in check.

Hydrogen and T&T So how does this hydrogen story fit into the https://www.goldmansachs.com/insights/pages/gsresearch/green-hydrogen/report.pdf 2 https://www.forbes.com/sites/ mikescott/2020/12/14/green-hydrogenthe-fuel-of-the-future-set-for-50-foldexpansion/?sh=381d81aa6df3 3 https://racetozero.unfccc.int/green-hydrogencatapult/ 1

narrative of Trinidad and Tobago energy? What value do we as a hydrocarbon-based economy stand to derive from replacing a share of our oil and gas with hydrogen?

As obtains elsewhere in the world, a principal benefit would be a reduction in the carbon intensity of our industry. Trinidad and Tobago is ranked among the most energy-intensive countries in the world, and one of highest GHG emitters per capita. Even though our absolute consumption and output relative to the rest of the world may be marginal, we are consuming and emitting at disproportionately high and unsustainable levels for a nation of our size. Since this is largely on account of our industrial activity, if we can meet a percentage of energy demand using cleaner sources such as green hydrogen, we can help clean up our emissions reputation. It would also serve to accelerate progress towards our nationally determined contribution (NDC) under the Paris Agreement, which is an overall reduction in cumulative emissions from the power generation, transport and industry sectors of 15% by 2030 from a business-as-usual baseline.

On another level, as our energy reservoirs mature, production of oil and gas is being forced into deeper water, making it more expensive to meet our energy needs. Diversification of our energy portfolio is the best way to ensure resilience, and that we can support continued industrial and economic growth in an uncertain future.

From a market perspective, new policies, taxes and regulations are being introduced to compel change in the direction of greener products. In some market segments, premiums are already placed on goods that meet certain sustainability standards (for example, organic food products). One of the

predicted applications of green hydrogen is in the decarbonisation of petrochemical production, and it may well turn out that ‘green’ petrochemicals gain preferential treatment in certain markets. Ammonia, for example, is a necessary input into agriculture, and as food demand multiplies with a burgeoning world population, green ammonia could become a market preference for sustainably increasing food production.

Green ammonia has also been pitched as a substitute fuel for the shipping industry.

Trinidad and Tobago is among the world’s top ammonia and methanol producers. If global markets do shift towards greener petrochemicals, the country should anticipate that shift and evolve accordingly.

There is also ample opportunity to integrate green hydrogen into other manufacturing activities, such as production of metals, cement, synthetic fuels for power plants, shipping fuels and vehicular transport fuels, to name a few.

Then of course there is the wider economic benefit of becoming a producer of green hydrogen. Technology and innovation may soon enable hydrogen to be traded in the same manner as liquefied natural gas (LNG) — Japan launched the world’s first liquefied hydrogen tanker in 2019 to explore the feasibility of bulk transport of hydrogen by sea.4 If this sector does grow, being an early-adopter in the region could allow Trinidad and Tobago to start a whole new chapter in its energy story.

The role of NGC In recent years, The National Gas Company of Trinidad and Tobago Limited (NGC) and its subsidiaries have been expanding the collective business portfolio to keep pace with the transitioning global energy sector. Investments have been made in renewable energy, energy efficiency and energy education projects. Embracing green is good for the planet, but also good for business. For instance, less natural gas fed into power generation means more feedstock and fuel for industrial consumers.

Exploration of opportunities to develop a green hydrogen industry in Trinidad and Tobago is the latest project in this growing portfolio. NGC is particularly well-placed to participate in the https://www.lr.org/en/insights/articles/world-firstfor-liquid-hydrogen-transportation/

4

development of a hydrogen industry as modified natural gas pipelines are considered viable interim stand-ins for hydrogen delivery infrastructure.5 Leading the reconnaissance effort into the hydrogen space is subsidiary National Energy. With support from the government, National Energy secured funding from the Inter-American Development Bank (IDB) to conduct feasibility studies in 2021, to understand the economic parameters of producing green hydrogen locally.

In addition to those efforts, NGC and National Energy have both committed support to the hydrogen cause through an Memorandum of Understanding (MoU) with Kenesjay Green Limited (KGL), which is also working to create a sustainable domestic hydrogen economy.

Through this partnership, our companies will explore joint development of viable, low carbon and green hydrogen-related industrial energy projects, as well as their associated renewable and energy-efficient feedstock supply.

Notably, KGL’s NewGen project to build the first carbon-neutral/green hydrogen production facility in Trinidad and Tobago, has already progressed through several preliminary milestones. If investment and market conditions continue to favour progress, the integration of green hydrogen into the energy mix may be closer at hand than we realise.

For this reason, it is equally important to push work on building a supporting value chain for hydrogen. This requires greater investment in ‘upstream’ renewable energy research and deployment, and the stimulation of downstream demand.

We at NGC and our subsidiary companies see the opportunities and the work that must be done to capture them. Importantly, we see the value on offer, and will therefore continue to work alongside relevant stakeholders to prepare Trinidad and Tobago for the era of hydrogen.

Learn more and have your say online: fb.com/ttenergychamber · #energynow

5 https://www.energy.gov/eere/fuelcells/hydrogenpipelines

opinion

| May 2021

15

energy.tt • @ttenergychamber

Upping the stakes on relationship management for business — and why you should act now Sheldon Daniel | Contributor

G

LOBALLY, companies are beginning to pay more attention to managing external risks through the proactive engagement of key stakeholders. In a recent special report on a 2019 online survey result of 1,418 participants, McKinsey & Co noted that nearly 60% of respondents said the topic of external engagement ranks among their CEOs’ top three priorities. This is up from 40% in 2013. Importantly, 22% of the CEO's named external engagement as their TOP priority in 2019, up from 11% in 2013 — a doubling of interest in six years. The pandemic would have accelerated this focus further.

One reason for this trend is that the nature of stakeholders is changing and becoming more complex. Traditionally, stakeholders are the people and organisations whose attitudes and actions could directly impact the success of a business brand or a project or product. These include government, state agencies, regulatory bodies, and communities. With the expansion in our communication in virtual spaces, we have less control over who is seeing or hearing us.

Stakeholders today can today range from one (like Greta Thunberg) to disparate groups of virtually linked persons such as a Reddit chat group.

The issues to be managed are becoming more complex and intractable as well. Environmental concerns are rising globally while economic inequality is becoming starker. These are coupled with a sharp polarisation along political and ideological wedges,

particularly on the 'culture' wars driven by social and even digital privacy. The all-encompassing nature of social media exposes businesses to huge reputation risks as they try to navigate this complex external space.

Here at home, we are not immune to these external impulses — 'global is now local'. Consider the recent public outcry when an employee of a popular dairy product provider was alleged to have made racially tinged statements; or the inelegant attempt by a restauranteur to support the Black Lives Matter (BLM) movement; or the backlash received by a supermarket chain with the introduction of reusable plastic bags without proper public relations groundwork. The active dialogue on the industrial consequence of our energy sector and our commitments to a low carbon, have also given prominence and increased social media estate to our conscious millennials. These are indicative of a general shift in public concerns about big-ticket societal issues. Sensible, responsible businesses should be prepared to respond.

However, apart from the energy multinational corporation (MNC) sector, there is little demonstration of a structured approach to managing external stakeholders — either to position their brands in this new space or in how they prepare for crisis. Conditioned by the past success of the 'old boys’/girls’ network, local business leaders are rightly confident they can get hold of virtually anyone they need to ' fix' a business issue.

There is also a view that issues of an external nature can be handled as they arise — pre-emptive or proactive planning is not a consideration. Many are unaware of the amount of effort put in by the energy MNC's to get stakeholder engagement right. While this is partly driven by the need for foreign companies to affirm their 'licence to operate,' these companies understand that access and growth are inextricably linked to confidence in their brands. Significant 'background activity' in stakeholder engagement occurs to generate outcomes/impacts which are not always known publicly.

Why does the CEO of a service sector company need to consider this an essential business function?

The short answer is that your business is not an island. It is part of a social and information ecosystem that competes for attention with a lot of 'noise'. These will include government officials/ technocrats, community leaders, business-tobusiness customers/owners, journalists, and opinion formers/influencers. You will inevitably

need external parties to facilitate your business at some point in time. This might be in times of crisis or when you have a business issue to be resolved or need your voice heard (and considered) on a pressing policy issue.

Investing in a structured stakeholder relationship management plan can allow relevant external parties to be supportive or willing to 'give you a chance' when you call upon them for support. It does this in three ways.

Firstly, you and your story are familiar. These audiences would have heard your story directly from you. They are not hearing about you at the same time as your crisis hits. You would have already owned and ventilated a well-crafted narrative of your business, its values and philosophy. In other words, they ‘know’ you.

Secondly, you build credibility by pro-active engagement. If the first time stakeholders see or hear from you is when you need something from them, the trust 'in the bank' might be low. You build credibility by investing the time to discuss and inform about your business to others while listening to their views, by connecting your values to theirs, and by associating your brand with positive causes. It’s about creating access for when the need arises.

Thirdly, by consciously adding breadth and depth to your external engagement, you learn new things that might help you do better business. It can add "intel" — providing an 'early warning' — system.

Continues on page 16

Call for STEM Professionals

join us to inspire students across the nation to pursue a career in STEM.

An opportunity to showcase your story as a STEM professional Incite interest in STEM subjects and careers

S En Tec Scie TEM Ma gin hno nce the eer log , ma ing y, tic & s

Impact underserved communities by driving STEM education across the nation.

Interested in inspiring others and making a difference? niherst.gov.tt

Contact NIHERST liaison Ms. Josanne Warner: teachme@niherst.gov.tt / 624-4611 Ext. 2007

16

opinion

| May 2021 energy.tt • @ttenergychamber

COVID-19 vaccines in the workplace:

Can employers make them mandatory?

Catherine Ramnarine | Contributor

C

OVID-19 continues to live up to its name, presenting new and evolving challenges for businesses as time goes on. The latest of these is the imposition of what some have termed ‘no jab, no job’ policies, under which employers seek to make it mandatory for their employees to be vaccinated against COVID-19. Are such policies enforceable in Trinidad and Tobago?

Health matters in the workplace When it comes to matters of health, some could argue that there is an inherent tension between an employee’s right to privacy and autonomy on the one hand and an employer’s legitimate business interests on the other. An employee’s rights in medical matters ought not to be lightly interfered with. However, they are not necessarily absolute. Employers can and do make enquiries and impose requirements on matters relating to employee health. For example, employers can make employment conditional upon employees being medically certified as fit to work, require employees to wear personal protective equipment or even terminate employees on medical grounds.

One can understand why some intrusion into matters of employee health might be reasonable. In certain circumstances, an employee’s health might have a direct impact on their ability to perform their job, and in extreme cases, pose health and safety risks. For example, a forklift driver with bad eyesight or a roofer with vertigo could potentially pose a danger to themselves and others.

That said, not every intrusion into an employee’s health is justifiable. Where does mandatory COVID-19 vaccination fall along this spectrum?

The answer will be different for each employer and may even vary from job to job or between different worksites within a single organisation.

Employers must carefully consider their own specific operational needs and objectives before making any policy decisions.

Employers could have a case for implementing COVID-19 vaccination policies where such policies: • Are in furtherance of legitimate business objectives; • Are reasonable and proportionate to those objectives; • Allow for legitimate exemptions; and • Are implemented in a realistic, practical and fair manner.

Legitimate business objectives Some employers might have legitimate business objectives in favour of mandating COVID-19 vaccination, such as promoting workplace health and safety, public health and even customer confidence. However, it will be important for employers to be guided by information and recommendations issued by local health and employment regulators and to assess whether, and to

what extent, vaccination actually achieves their desired objectives. For example, the efficacy of vaccination in the prevention of asymptomatic transmission is not yet settled.

Reasonableness and proportionality Even if an employer does have legitimate business objectives, this does not automatically entitle them to impose mandatory COVID-19 vaccination policies. Such policies must be also be reasonable and proportionate.

This means conducting an examination of: • The risks that an unvaccinated employee might pose; and • The extent to which such risks can be mitigated by other workplace controls such as social distancing, wearing face masks, sanitisation or remote work.

It may be easier to make the case that mandatory vaccination is reasonable and proportionate in some industries — like health care, travel or hospitality — than in others. The position may even vary from job to job or between different worksites within the same business.

Even where other workplace controls exist, this does not automatically mean that an employer is bound to apply them instead of vaccination where there is a real risk that this would result in lower workplace efficiency, higher operational costs or require vaccinated employees to do more than their fair share of potentially hazardous or burdensome work.

Each employer would need to weigh the potential risks and requirements of their own operations before making a decision.

Legitimate exemptions Some employees may be reluctant or outright refuse to get vaccinated. Their reasons for doing so could potentially fall within the protected categories established under the Equal Opportunity Act. The Act prohibits discrimination in employment based on (among other things) disability and religion.

• Disability: It is possible that an employee might have a genuine medical reason for why they cannot be vaccinated. What should an employer do in such a case? As a preliminary step, they must be guided by medical opinion and not the employee’s or their own personal view of the situation. It is reasonable to request that the employee submit a medical from a doctor confirming that they have a genuine medical reason why they cannot be vaccinated.

• Religion: Some religious groups may have an absolute objection to vaccines. Others may have objections to specific vaccines, such as those that involve testing on foetal cell lines. Religious objections may require a more nuanced response than objections based on medical grounds. That said, it is noteworthy that even the Vatican has reportedly issued guidelines for its own employees, warning that those who refuse the vaccine without proven health reasons could face penalties including the termination of the employment relationship.

Waterfront Towers, Port of Spain Even if an employee does have a legitimate reason for refusing COVID-19 vaccination, this does not automatically mean that they would be exempt from a vaccination policy. The employer would again need to consider the risks that an unvaccinated employee might pose, whether being vaccinated is inherent or critical to the performance of the job in question and the efficacy of alternative workplace controls.

It is also important to note that a generalised fear or scepticism of vaccines is not protected under the Equal Opportunity Act. Implementation From a practical perspective, it is also important to ensure that any COVID-19 vaccination policy is implemented in a realistic, practical and fair manner.

This includes: • Giving employees advance notice before the policy takes effect • Allowing employees an opportunity to raise medical, religious or other objections • Setting realistic timetables for employees to be vaccinated; it may not be practical to require all employees to obtain the vaccine immediately as it becomes available • Considering offering paid time off to enable employees to both obtain and recover from vaccination • Being clear on what evidence employers will require in order to prove vaccination

In a unionised environment, consultation with the recognised majority union may also be required.

Regardless of the strict legal position, no employer wants to risk losing or demotivating a good employee because of that employee’s reluctance to be vaccinated.

A more strategic and holistic approach would also include education and encouragement rather than a simple unilateral mandate. This would help to ensure employee buy-in to any policy that an employer might wish to introduce.

Author's Note At webinar held on February 24th 2021 (after this article was written) President of the Industrial Court, Deborah Thomas-Felix expressed the view that the imposition of a mandatory vaccination policy could amount to a unilateral alteration of the terms and conditions of employment. Unilateral alterations are not valid and in some cases may even be grounds for constructive dismissal claims.

This does not mean that employers cannot introduce vaccination policies. However, it does underscore the importance of carefully considering and prioritising the objectives that you are seeking to achieve by such policies and the most strategic approach for achieving them. A holistic approach that includes encouragement and employee buy-in will be more effective than a unilateral mandate.

Learn more and have your say online: fb.com/ttenergychamber · #energynow

Upping the stakes on relationship management for business — and why you should act now (continued) Continued from page 15 You might learn new things about customers, about pending policy changes or about business solutions that you might offer which you hadn’t previously considered.

So, what does a stakeholder engagement plan look like?

It is nothing as elaborate as many 'consultants'make it out to be. A good plan is fit-for-purpose, varying by business objectives and needs. It begins with a robust, internally driven diagnostic that carefully analyses and defines the players who can positively or negatively impact the viability and growth of your business. These

persons should be viewed across the spectrum of government, non-governmental organisations (NGOs), academia, media, community — and of course social media influencers. From a risk assessment perspective, this is an internal enquiry shaped by questions like “Who are those persons, organisations or groups who can make, break, interfere with, support or facilitate our plans?” This should be an ongoing assessment — perhaps once every quarter. This is the foundation of the stakeholder engagement plan. Once you have this assessment of key stakeholders, you need to have a plan for how to and who from your business will lead the engagement. The intent is for stakeholders to have a good understanding of your business and plans — including the wider societal or economic value to your business as underscored by your social or corporate

social responsibility (CSR) programmes.

You should be equally familiar with the needs and interests of your key stakeholders and how you can support those ­— as consistent with your corporate code of ethics. Successful engagement is not one-sided as it relies on common ground — mutual interests.

There should also be consistency in engagement.

The 'when' should be with a practical periodicity that credibly demonstrates your ongoing interest with the stakeholder. The final element is performance management — some mechanism to review and 'manage' the plan. This ensures that you and your company are learning and truly using the information gathered to continuously identify risks and to improve your business plans.

For smaller companies in the energy services

sector, this might seem like too much process. It does not have to be overly formal, but it is an effective risk management exercise. There will be an expectation by the MNC’s that your reputation — just like your safety systems — is being actively managed. When working on their site, your reputation is interwoven with theirs.

Consider what others (your stakeholders) say about you as a critical competitive enabler and a differentiator.

Taking control of that narrative is not a 'nice to do' but rather a business essential that can pay dividends in new business or increased brand loyalty by those who already trust you.

Learn more and have your say online: fb.com/ttenergychamber · #energynow

efficiency

| May 2021

17

energy.tt • @ttenergychamber

Knee-deep in a COVID-19-stricken economy, why should the Caribbean accelerate investment in sustainable energy?

Gary Jackson, Executive Director, CCREEE | Contributor

D

URING recent interviews on the newly launched Project Preparation Facility (PPF) established by the Caribbean Centre for Renewable Energy and Energy Efficiency (CCREEE), the host asked an interesting question: “what kind of uptake does the PPF expect in 2021 given the region’s current challenges, such as the COVID-19 pandemic?” It is an interesting question because it contains the justification for its own answer. The PPF anticipates high levels of interest in sustainable energy project development support precisely because of the external pressures the region faces.

The Caribbean’s economy has undoubtedly suffered due to COVID-19, with the pandemic exposing key vulnerabilities in our economic development strategies. Many Caribbean nations are mono-product economies, dependent on tourism and reliant on external sources for goods and commodities. This presents a significant challenge. Reduced flight frequency and restricted borders and lockdowns mean the COVID-19 pandemic has brought tourism and much else to a crawl and in some instances, to a halt.

Consequently, funds have been reprioritised to meet health demands and provide economic support where it is most needed. With resulting limited cash flow, decreased impetus for the initial investments needed for sustainable energy development is expected.

Despite the prevailing economic climate, we cannot halt the Caribbean’s energy transition when sustainable energy presents a viable and lasting solution to our economic challenges. Energy often features high on the list of expenses for households, businesses, public entities, utilities, and many essential services. The cost of electricity in the Caribbean is elevated because of the high unit cost and price volatility of the imported fossil fuels required for most of our energy generation. For instance, in 2015 The US National Renewable Energy Laboratory (NREL) reported an average electricity cost of US$0.33 per kWh in the Caribbean — a rate three times higher than their average. To note, approximately 60 to 70% of the electricity cost is attributed to fuel. Any avenue to produce locally sourced energy at reduced rates or, to consume energy more efficiently, will provide needed monetary relief and ensure independence from high and volatile oil prices.

Fundamentally, renewable energy and energy efficiency offer substantial holistic benefits in the form of gross domestic product (GDP) growth due

to increased responsible consumption and trade, improved foreign exchange reserves, increased financial savings, improved social welfare through additional finance for health and education, accelerated job creation, and reduced carbon emissions. A 2016 IRENA study revealed that doubling renewable energy usage by 2030 will result in up to 1.1% GDP growth, 24 million jobs, and 3% welfare improvement globally.

These benefits extend to a wide range of sectors such as health; tourism; agriculture; water; information, communication technology (ICT) and manufacturing.

The CCREEE PPF seeks to help CARICOM member states take hold of these benefits through sustainable energy project support and, critically, by facilitating eligibility to project financing and scaling up.

Not widely known is the availability of project financing from financial institutions, development funds, and impact investors. There has been a mismatch between this available finance and the quantity of investment-ready projects present in the region.

Although blessed with an abundance of renewable energy resources, many Caribbean project proponents have struggled to convert their ideas into bankable projects.

In this vein, the CCREEE’s Project Preparation Needs Assessment revealed that regional stakeholders require support in the areas of: accessing financing, technical knowledge of renewable energy and energy efficiency, project documentation expertise, and the capability to navigate the regulatory environment

within the countries, among others. The PPF meets these deficits through a broad range of service offerings, from business plan refinement to feasibility studies to financier introduction. The Facility is a timely addition to the sector — poised to give Caribbean nations a needed boost toward their sustainable energy targets.

As we welcomed 2021, many hoped for a year much less impacted by the ongoing pandemic. In that hope, we must not neglect the lessons learnt from the 2020 experience. Having seen the extent of the Caribbean’s vulnerability to external shocks, we should take advantage of every opportunity to fortify ourselves. Sustainable energy offers not just economic but critical social and environmental fortification. The COVID-19 pandemic is just one challenge among many.

As Small Island Developing States, climate change looms and ushers in what scientists have dubbed the age of pandemics. There is simply no better time than the present to strengthen partnerships and build the resilience of our energy systems through renewable energy and energy efficiency solutions.

Co-authored by: Sapphire Vital and Charlin Bodley

Learn more and have your say online: fb.com/ttenergychamber · #energynow

18

efficiency

| May 2021 energy.tt • @ttenergychamber

Catch and kill Gary Clyne and Derrick Freeman Esquire | Contributors

E

XXONMOBIL has proposed establishing an Innovation Zone in Texas along the Houston Ship Channel and a surrounding industrial area to capture emissions from petrochemical, manufacturing, and electricity generation plants there, and pipe them into natural geological formations below the Gulf of Mexico sea floor for storage. The project would cost at least US$100 billion and require financial support from the U.S. government.

NEXT Carbon Solutions, a subsidiary of ExxonMobil, plans to develop one of the largest carbon capture utilisation and storage (CCUS) projects in North America at Rio Grande LNG in South Texas, which is expected to enable the capture and permanent geologic storage of more than five million metric tons of carbon dioxide per year.

Mitsubishi Heavy Industries Group and Oxy Low Carbon Ventures (Occidental Petroleum Corporation) have executed term sheets for the offtake and permanent geologic storage of CO2 captured from ExxonMobil’s planned Rio Grande LNG project at the Port of Brownsville, Texas. Under the terms of the agreement, Occidental Petroleum Corporation will offtake and transport CO2 from the Rio Grande LNG project and permanently sequester it in an underground geologic formation in the Rio Grande Valley, where there is vast CO2 storage capacity, pursuant to a CO2 Offtake Agreement and a Sequestration and Monitoring Agreement to be negotiated by the parties.

Koch Engineered Solutions has recently announced a US$9.2 billion multi-year programme located at the Port of Greater Baton Rouge. The project will produce green hydrogen, renewable diesel, sustainable aviation fuels, and bio-plastic feedstocks. The project also includes CCUS. All of the projects described above were first conceptualised by a Texas-based small business consortium in partnership with Trinidadian technology providers.

Past opposition to carbon capture has centred on two issues: the argument that it prolongs dependency on fossil fuels because it allows extraction and production to continue at the expense of demand for renewable

energy, and the concern that continued coal- and gasfired energy production adversely impacts the health of marginalised communities located near fossil fuelbased facilities, thereby perpetuating environmental injustice. However, carbon capture is a critical bridge to clean energy that will ultimately replace fossil fuelbased sources. Moreover, growing scientific consensus asserts that the only way to reach net zero carbon within a timeline that prevents irreversible damage from climate change is to leverage carbon capture technology.

The daily average of CO2 in the atmosphere is at 421.21 parts per million — the first time in human history that number has been so high. Our planet is in trouble, and we have spent decades researching, cajoling, writing, speaking, and legislating in the hope that the oil and gas supermajors would listen. People are not to blame — it is the globeshaping, government subsidy receiving, fossil fuel combusting, and natural gas reacting technologies of supermajors that drives overconsumption of wealthy nations.

The U.S. government has stimulated oil and gas production for decades through subsidies to ensure a domestic supply. U.S. taxpayers currently subsidise supermajors by US$6 billion a year, with more than half of that going to five oil companies — ExxonMobil, Shell, Chevron, BP and ConocoPhillips.

These are not the firms we should now trust to lead a charge from a transition of fossil fuels to renewables.

So how are they now the lead contenders for government money to deploy CCUS? U.S. President Joe Biden is enacting deep cuts to emissions, not just by the U.S., but by the wealthiest

American — polluting industries specifically. There is no other physically possible, science-consistent way for full implementation of the Paris Agreement.

The legislation being enacted includes a major initiative for the inclusion of small business. Small business possesses the greener efficiency-enhancing innovations that will reduce the resource intensity of economic activity and small business understands that the planet is in a deadly race against time. The more carbon we burn, the less carbon margin for our descendants. But what if the supermajors are leveraging the rights to the CCUS and low emission development projects with no intention to perform, but to bury them so that they cannot be developed?

Using legally unenforceable agreements, the supermajors could be claiming exclusive rights to CCUS projects within the fossil fuel industry to 'catch' the climate-resilient project, but then 'kills' the project to maintain the planet’s fossil fuel addiction and prevent it from ever being built. The U.S. government will not realise that a supermajor intends to suppress the project instead of building it, thereby maintaining the status quo until it is too late. Climate change considerations are frequently trumped (no pun intended) by ambition for endless accumulation and greed.

'Catch and kill' is also a surreptitious technique that could be employed by the fossil fuel industries to prevent legitimate and small business renewable and low emission asset developers from building carbon mitigation or avoidance facilities with U.S. government grant and loan support. CCUS technology is not new and widely accessible. So, with U.S. government money availability, why should supermajors monopolise the CCUS transition market space? It is not like the superpowers hold a monopoly on the innovative methodologies necessary to create robust CCUS projects in the US. The thought of catch and kill is terrifying for new and small businesses entering the US climateresilient development market. Supermajors with the rights to every CCUS project in America would be the end of hope for a less than 2-degree Celsius temperature rise.

Small business can develop CCUS projects that are sustainable and deployable at scale. The federal government must get more involved so that the supermajors must compete for a 'fair share'

of carbon mitigation projects, provide proof of their merit-worthiness, and hard commit to CCUS project execution. Simply put, they must be monitored and provide scheduled measurable deliverables for day one and projects not dependent on firm investment decision by shareholders. Small business has been the elite early adopters and ecological entrepreneurs of the low emission global market. Infrastructure projects and climate change considerations co-exist, but small business is the key as it carries none of the baggage of conflict of interest or potential to self-deal.

Conventional wisdom has it that President Joe Biden can affect only modest progress on climate change legislation. But this undervalues the levers the administration can pull, including motivating the private sector. Thus, the U.S. government can set standards and exert pressure on industry. The financial sector is particularly ripe for change.

Stimulating private finance does not involve federal spending per se, so it does not need Congressional approval. But the financial sector can use U.S. government’s scale and ability to direct capital and apply it to international deployment of CCUS. The U.S. government can direct federal funds, grants, and low interest loans to invest in companies that have carbon emission reduction pathways aligned with Paris accord commitments and can also push the World Bank to make climate finance a centrepiece of its lending. Without financial sector reporting advanced nations will never be able to raise capital to pay for the effects of climate change.

President Biden has announced the dismissal of the Trump administration’s 2019 Department of Justice lawsuit challenging parts of California’s cap and trade program. The Biden Administration understands that climate change mitigation is a global collective challenge, demanding coordinated action among many different private sector stakeholders as well as developed and developing nations. For developed nations, the benefits of climate mitigation are uncertain, unevenly distributed, and accrue primarily to future generations. For developing and small island states, climate action is an opportunity for economic growth and job creation. CCUS is an important key.

The December 2015 Paris Agreement gives countries the green light to voluntarily buy and sell tax credits and carbon credits across borders, suggesting a cooperative approach that will deepen and expand CCUS market links. The actual buyer and seller of tax and carbon credits will be private oil and gas companies operating in the two countries, making use of linking rules being developed under the Paris Agreement. An example of a link that currently exists is where two emissions trading systems are joined, such as that between California and Canada. Private entities operating within these systems can trade U.S. allowances and Canadian allowances, use the allowances for compliance in their respective country and know that there is some cascade upwards to the U.S. and Canadian accounting framework. The approach is quite simple, transparent, and effectively a non-issue for the participants in the transactions. Carbon exchanges are the science-based quantifications of carbon reduction and require a technical expertise that small business can easily acquire, which would allow small business to participate in a US$1 trillion a year global market.

Can the U.S. meet the Biden Administration’s new carbon emission reduction goals and can Paris accord obligations work without a global marketbased emissions trading mechanism that preclude border taxes? We do not think so. Will it reduce the influence of the economic and environmental supermajors bullies of CCUS? We hope so. Will the Biden Administration prevent 'catch and kill'?

It must for our descendant’s sake—the next few months will determine if small business has a place in CCUS, and if supermajors have the power to kill it.

Learn more and have your say online: fb.com/ttenergychamber · #energynow Petrochemical facility on the Pt Lisas Industrial Estate

19

| May 2021

energy update

energy.tt • @ttenergychamber

Monthly Review

Crude Oil Production Daily Average (000s Barrels)

Liquefied Natural Gas Production (cu m)

62 60 58 56 54 52 50 48 46

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to you every step of the way!

Feb-2020

We take care of what’s important

45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0

Number of Rig Days

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Petrochemical facility in Pt Lisas at dawn Feb-2021 Feb-2021

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20 | May 2021

energy.tt • @ttenergychamber

Monthly Review Production of Butane (bbls)

250,000 200,000 150,000 100,000 50,000 0

Production of Urea (000s Tonnes)

70 60 50 40 30 20 10 0

21

| May 2021

efficiency

energy.tt • @ttenergychamber

Verification for CNG dispensers Staff Writer | Energy Chamber DISPENSERS at compressed natural gas (CNG) service stations across the country are in the process of being verified by the Legal Metrology Inspectorate (LMI), a unit of the Trinidad and Tobago Bureau of Standards (TTBS). The LMI recently commenced its verification work on nozzles of dispensers installed and maintained by the NGC CNG Company Limited (NGC CNG) for the motoring public.

According to NGC CNG, this verification exercise is required under the Metrology Act Chapter 82:06. The Act mandates the LMI to monitor and verify prescribed measuring devices used in trade, including CNG dispensers at all service stations nationwide. Currently, there are 10 operational CNG stations in Trinidad for fuel dispensing to the public and three fleet-based stations — two in Trinidad and one in Tobago.

The purpose of the verification exercise is to ensure that the volume of CNG dispensed from the nozzle is accurate as stipulated in the Act. This ensures that all stakeholders in the value chain, including the end user — the CNG vehicle driver — are assured that the quantity being paid for is in fact received.

Curtis Mohammed, President of NGC CNG, applauded TTBS for the work to support the development of the CNG industry over the years, which includes an update of the national standard and now, verification of the CNG dispensers.

Noting the significance of this accomplishment, Curtis Mohammed stated that "Verification in the CNG industry, which is something that normally would not have been in focus before, has actually started. The consumer can now be very comfortable that there is a third party verifying the calibrations of the company. This helps to know that the actual entity that determines the verifications will be doing that going forward."

Once a CNG dispenser nozzle passes the

Bi-fuel vehicle that be operated with gasoline and CNG verification test, a yellow PASSED LMI label will be affixed to the device. This serves to confirm to the consumer that the dispenser is accurately dispensing the correct volume (quantity) of CNG. A certificate of verification is also issued to the owner of the device. CNG verification takes places every six months during which, periodic surveillance is undertaken by the LMI. Speaking on the rationale of the CNG dispenser verification exercise and the benefits it brings to the end users, Mrs. Erica Caruth, Manager — Metrology Division, TTBS, said, "CNG dispenser verification is one of the milestones of verification in the retail fuel

sector and it fulfills the mandate of the Metrology Act Chapter 82:06, which ensures that all prescribed measuring devices used in trade are verified. This provides assurance that the measurements that are being provided by the instruments are in fact reliable and accurate."

The verification of the CNG dispenser was conducted using a Micro Motion Coriolis Mass Flow Master Meter. The master meter is connected between the CNG dispenser and the vehicle it serves to accurately measure the CNG that flows into the vehicle.

TTBS, in accordance with the Metrology Act,

is the national custodian and verifier of reference standards and as such, it must obtain, conserve, develop and disseminate the basic measurement units and the highest level of calibration standards that the country demands.

NGC CNG Company Limited is a subsidiary of The National Gas Company of Trinidad and Tobago and has a mandate to accelerate the supply of CNG at 22 new service stations and increase the demand.

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New carbon market established in Washington State Staff Writer | Energy Chamber ON April 24th, the Washington state legislature passed the Climate Commitment Act (Senate Bill 5126), which commits the state to an economywide cap-and-invest system to cut greenhouse gas (GHG) emissions starting in 2023. This law makes Washington one of 13 states in the U.S. to launch a carbon market.

“We warmly welcome this new ambitious statelevel market,” said Dirk Forrister, President and CEO of International Emissions Trading Association

(IETA). “The programme sets a firm emissions reduction target, and covered sources are free to choose how to make the reductions in a market that rewards additional action with economic value.

The system is economically efficient for consumers, workers and businesses alike.”

The state’s new carbon market will help drive emissions to achieve previously agreed goals of cutting GHGs by 45% below 1990 levels by 2035, and net zero by 2050.

“2021 is shaping up to be one of the most remarkable years in our collective response to

climate change," Forrister added. "China and the UK are launching new emissions markets, New Zealand has revamped its system to set an absolute cap on emissions for the first time, and the voluntary market is growing by leaps and bounds.”

Washington’s market has been explicitly designed to link to other 'allowance-based' markets such as California’s cap-and-trade system or the 11-state Regional Greenhouse Gas Initiative in the US northeast.

“We’re particularly pleased that Washington has recognised the value of programme alignment and

linked markets, which can offer greater economies of scale and widen the pool of available abatement,” Forrister said.

“We look forward to playing an active role as the state’s Department of Ecology begins the process of turning legislation into the regulations required to operate the market.”

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IDB Study: EVs in Jamaica could help boost GDP Staff Writer | Energy Chamber “IF Jamaica were to electrify 12 to 16% of its private and public fleets, the economy would benefit from approximately 2% of the GDP.” This recent revelation came from Therese Turner-Jones, the General Manager of the Inter-American Development Bank’s (IDB) Country Department Caribbean Group and Jamaica Country Representative. Ms. Turner-Jones was speaking at the recent launch of the project led by the JPS Foundation and IDB’s Lab, for Building a Sustainable Electric Mobility Ecosystem for Inclusion and Access in Jamaica. With Jamaica’s gross domestic product (GDP) in 2020 being US$14.23 billion, this puts the potential benefit of this level of electric vehicle (EV) usage at a savings

of up to US$284 million.

The short-to-medium-term objectives of the project include the introduction of 200 battery electric vehicles in Jamaica; training of 400 individuals in maintenance and safety practices related to this technology and support for 15 innovative green business models with the potential for meaningful job creation.

Turner-Jones also noted that the IDB is supporting governments in over 15 countries across Latin America and the Caribbean, to establish the ecosystem for deployment of electric mobility.

Elaborating on this effort, she explained that through a US$1.5 million grant from the Japanese government, the IDB and the IDB Lab are supporting the government of Jamaica, to establish among

other things: the fiscal and regulatory framework; deployment of EVs to understand the business model and raise public awareness and reskilling of the workforce which can generate new ventures such as a battery recycle market.

“I am pleased to say that the Ministry of Finance supports the fiscal regime proposed so we have a strong commitment between the government and the private sector to accelerate the EV agenda,” she disclosed. She also shared that the IDB is working with the Ministry of Transport and the Jamaica Urban Transit Corporation, to develop a battery electric bus pilot.

Pointing to an example in Barbados, TurnerJones noted that the small eastern Caribbean state is leading in early adoption of electric vehicles, with

lower import duties for electric vehicles (at 10%), while vehicles with internal combustion engines attract import duties of 45%. Also, that island is the first to bring in 33 electric buses in addition to the over 400 private electric vehicles and 85 charging stations already in operation.

The signs for a robust electric vehicle market in Jamaica are promising, with not only potential financial savings, and development of a new local service industry, but also a significantly cleaner environment.

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renewables

| May 2021 energy.tt • @ttenergychamber

Lightsource bp has signed a power contract with Amazon for a new 375 megawatt solar project in Ohio to support their operations locally Staff Writer | Energy Chamber LIGHTSOURCE BP has executed a power purchase agreement with Amazon for a new 375 megawatt (MWdc) solar project under development in Ohio, as part of Amazon’s long-term commitment to power its global infrastructure with renewable energy. Once complete, the solar facility is expected to deliver nearly 600,000 megawatt hours (MWh) annually of additional renewable energy for Amazon operations locally, equivalent to the annual electricity consumption of about 55,000 U.S. homes.

The project will be located in Auglaize and Allen Counties. Generation from the solar project is expected to reduce greenhouse gas emissions by 423,700 metric tons of CO2 annually, equivalent to removing 91,515 fuel-burning cars off the road.

Additional economic investment and local benefits of this project will include approximately $94 million in additional revenue for the local

communities through a pilot programme over the life of the project, with $1.5 million to local school districts each year, for 35 years.

In addition, 400 or more jobs will be created, during the 18-month construction of the facility, with 80% or more local Ohio labour.

A $4.6 million annual operations budget, will primarily be spent in the region.

An estimated $314-364 million of private investment by Lightsource bp and project investors into energy infrastructure for the state, will help to diversify Ohio’s energy portfolio and strengthen energy security with local electricity generation.

Emilie Wangerman, SVP of Business Development for Lightsource bp said, “Investment in renewable energy by corporations such as Amazon is spurring development of clean and affordable energy sources in the U.S. that are benefiting everyone — from reducing pollution from electricity generation for our country’s overall grid to economic benefits,

including new revenue for schools, that are staying local and supporting communities near the projects.”

Stephanie Kromer, Director of Energy & Environmental Policy at Ohio Chamber of Commerce said, “Amazon has a long-term commitment to utilise 100% renewable energy, and has invested in operations infrastructure in Ohio. In just three years, the combined direct, indirect and induced effects of Amazon’s investment in our state could create thousands of new jobs for Ohioans and hundreds of millions of dollars in new regional income and GDP in Ohio.”

In addition, Michael Ruppert, Business Manager IBEW Local Union 32 said, “This solar project will bring additional investment dollars into our community while helping to power both local businesses and the economy. New and established businesses like Amazon are investing in Ohio and with that investment comes the desire to be able to purchase home-grown Ohio power that’s cost

competitive, clean and renewable. Projects like this allow for energy investment and other economic benefits to remain local.”

He added, "Solar projects do more than reduce emissions that negatively affect our environment and the health of Ohioans. They also help strengthen local economies by contributing significant new annual revenue to schools and other public services, bringing multi-million-dollar annual operations budgets, and creating good-paying construction jobs." It is expected that the Birch Solar Project will be the largest corporate taxpayer in Allen County.

Locally generated renewable energy also attracts and retains businesses such as Amazon which significantly contribute to Ohio’s economy.

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news

| December 2020 energy.tt • @ttenergychamber