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Trinidad Gas company (NGC) and Nitrogen Company (CNC) back to the negotiating table

By Curtis Williams

Petroleumworld 03 05 2018

The National Gas Company Limited (NGC) and Caribbean Nitrogen Company (CNC) have quietly returned to the negotiating table after a major stand-off that resulted in the NGC cutting off natural gas to the company and CNC taking the State-owned enterprise to the UK Court of Arbitration.

The stand-off earlier this year, led to the Government accusing CNC of trying to bully the NGC for gas and saying it is not a secret that NGC will have to pay significantly higher prices for gas in 2019.

“The behaviour of CNC which has shareholders who hold significant shareholding in other plants in Point Lisas is instructive and disappointing,” the ministry had said.

CNC had called for the NGC "to be transparent and stop hiding behind vague statements that don't have any basis in reality."

It also accused NGC's chairman Gerry Brooks of high handedness in the negotiations: "Even though NGC is in effect owned by the people of Trinidad and Tobago, Mr Brooks' precipitously heavy-handed tactics have just negatively affected the livelihood of more than 400 people, thereby threatening to wreak further havoc on the economy of the country."

In a memo to its staff, CNC revealed that its negotiating team had resumed talks with the NGC and was working feverishly to get a long-term gas supply contract with the NGC.

The negotiations resumed just after Carnival and brings some hope to 400 workers who are likely to go on the breadline if no agreement can be reached. The shutdown has already resulted in millions of dollars in losses to CNC and potentially millions of US dollars in foregone revenue to the Government because of no production from the plant.

NGC: The matter is still sub-judice

Both CNC and the NGC are remaining tight lipped on the negotiations. Yesterday, the Sunday Guardian sent the following questions to Brooks.

1) Have the NGC and CNC returned to the negotiating table?

2) If so are the parties any closer to reaching an agreement?

3) Is the price of gas still the major point of disagreement?

4) Do you feel confident that an agreement will be reached?

5) Has either party given a timeline for a resolution?

Brooks did not respond, but the company's communication's manager Lisa Burkett told the Sunday Guardian, “The matter is still sub-judice and NGC would prefer not to make a comment at this time.”

At the heart of the battle is the price at which the NGC is prepared to sell natural gas to the downstream companies and the continued shortage of natural gas.

Ammonia is also used for the production of plastics, fibres, explosives, nitric acid, and intermediates for dyes and pharmaceuticals.

T&T is the sixth largest producer of ammonia in the world and the largest exporter of the commodity to the United States. A recent study showed that T&T earns the most amount of money per molecule of gas from ammonia than from any other thing produced using natural gas.

This means that taxpayers get the greatest benefit from the natural gas being used to produce ammonia than it does for LNG, methanol or urea.

It effectively means with the continued shutdown, the country is failing to have in operation a major plant that produces its most valuable commodity.

Meanwhile, as uncertainty continues in the downstream sector and in the refining sector at Petrotrin, there are ads in the daily newspaper in which companies from Kuwait are seeking to recruit locals with experience as refinery operators or operators in the local downstream sector.


Story by Curtis Williams from Trinidad & Tobago Guardian
03 04 2018

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