ceis petroleum update march 2013
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CEIS Petroleum Update for March 2013TRANSCRIPT
C urrently, islands of the Caribbean basin are primarily net
energy importers (with the exception of Trinidad and
Tobago, one of the major exporters of liquefied natural
gas (LNG) in the world). Venezuela provides a sizable
amount of crude oil and refined products to their Caribbean neighbours
at below-market prices and with favorable financing terms under the
PetroCaribe agreement. Some Caribbean islands are important centres
for oil refining and storage, due to their proximity to external markets.
In recent years, there have been concerns that the continuous global
increase of oil prices will negatively affect economies of the Carib-
bean, as there is a significantly high (and still growing) dependence on
oil for energy needs. In response, the island nations have been discuss-
ing ways to promote alternative energy/oil sources to better feed their
energy sectors. There
have also been signifi-
cant investments by
international entities
garnered toward the
exploration of the off-
shore areas of the Car-
ibbean, as existing fac-
tors deem it fit to maxi-
mize on the oil potential
in the region.
MAIN PLAYERS MAIN PLAYERS MAIN PLAYERS
Trinidad and Tobago
Trinidad and Tobago has the bulk of the Caribbean's oil production.
Most of such oil production and exploration is focused offshore. The
government has been encouraging field development onshore as well.
In 2012, the country produced approximately 82,000 barrels of oil per
day, of which 73% were produced offshore. Oil production had been
falling since the 1980s and lead-
ing to the 90s. Prices however
significantly increased a decade
later when BHP Billiton’s off-
CARIBBEAN PETROLEUM UPDATE is a monthly Bulletin which highlights petroleum issues affecting or relevant to the
Caribbean, international developments that may affect the region’s way of life and movements in oil prices and retail prices for fuel regionally.
To access CEIS website
CONTACT US
Caribbean Energy Information System
Scientific Research Council
Hope Gardens, Kingston 6, Jamaica
1-876-927-1779 (Telephone)
1-876-977-1840 (Fax)
www.ceis-caribenergy.org continued on page 2/
CARIBBEAN ENERGY INFORMATION SYSTEM (CEIS)
MARCH 2013 ISSUE
Oil/Natural Gas and The Potential of the Caribbean oil industry
Trinidad and
Tobago rank
5th in Natural
gas export to
the US. Image source: http://www.ecoglobe.ch/energy/e/peakoil.htm
page 2 Call: 1-876-927-1779 | Caribbean Petroleum Update : March 2013
C A R I B B E A N E N E R G Y I N F O R M A T I O N S Y S T E M ( C E I S )
shore Angostura oil and gas field came
online in January 2005. Oil producers in-
cluding the Petroleum Company of Trini-
dad and Tobago, BP Trinidad and Tobago
and BHP Billiton, in the past seven years
(2005-2012), had a steady decline in oil
production. EIA also stated that, “in 2006,
oil outputs reached nearly 178,000 bbl/d,
but production has fallen below the coun-
try’s expectation to produce 200,000 bbl/d
of crude.” According to Global Insight, “the
recent fall in output has been attributed to
maturing oil fields and operational chal-
lenges faced by some of the country’s larg-
est producers.” EIA data indicates that the
United States has been T&T’s primary cus-
tomer, with average demands of 76,000
barrels per day of crude oil and refined
products. Trinidad and Tobago consumes
an estimated 40,000 bbl/d and even though
they are major producers, the country also
imports small amounts of crude oil and
refined products.
“Trinidad and Tobago is also the largest
exporter of LNG to the United States, and
the fifth largest exporter in the world be-
hind Australia, Indonesia, Malaysia and
Qatar”, according to FACTS Global Energy
2010 figures. EIA data shows that Trinidad
and Tobago exported 129 Bcf of natural gas
to the United States in 2011, about 37 per-
cent of total U.S. LNG net imports, but less
than 1 percent of total U.S. natural gas sup-
ply. For the past seven years, U.S. LNG
imports from Trinidad and Tobago have
declined by almost one-third, which reflects
a general decline in total U.S. LNG imports.
According to PFC Energy “the country may
not be able to maintain output levels
through to year 2020.
Cuba
Production in Cuba has increased from
13000 bbl/d in the 1980’s, to approximately
55,000 bbl/d making the island net import-
ers. Cuba imports from Venezuela and has
net imports amounting to approximately
116,000 barrels per day, while consumption
is over 170,000 barrels per day. Most of
Cuba's oil production occurs in the northern
Matanzas province. Much of this produc-
tion occurs onshore, though there is some
offshore production in shallow coastal wa-
ters. Cuba’s oil production seems to have
largely stabilized in the near term, amid any
additional increases in production depend-
ent upon the discovery of substantial new
reserves.
There have been huge interests to explore
Cuba's offshore basins towards the Gulf of
Mexico. According to the U.S. Geological
Survey (USGS) “the mean estimate for
undiscovered oil reserves in the North Cuba
Basin (the basin north and west of the is-
land in the Gulf of Mexico) is 4.6 billion
barrels. Cubapetroleo, or Cupet (Cuba’s
state-owned petroleum company) estimates
that all of Cuba’s offshore basins could
contain in excess of 20 billion barrels of
undiscovered oil reserves. However, actual
exploratory drilling in the area has been, to
date, quite limited”. In 2011, international
companies operating in Cuba reported that
they plan to drill five exploration wells in
ultra-deep waters of the exclusive economic
zone in the Gulf of Mexico, according to
Global Insight. Mass investment from inter-
national partners sought to the beginning of
drilling of an exploration well located in
Cuba’s exclusive zone.
International Attention
In recent years, there have been concerns
that higher global oil prices will negatively
affect the Caribbean economies, as they are
highly dependent on oil for their energy
needs. In response to the rise in prices,
Trinidad and Tobago alongside Cuba and
other island nations of the Caribbean have
began discussing ways to promote alterna-
tive energy sources and better integrate
their energy sectors. According to estimates
from Bloomberg and Oil and Gas Journal
(OGJ), “the Caribbean region has a com-
bined 1.6 million bbl/d of nominal refining
capacity.
Oil Geography
Nobody expects the Caribbean to ever
become oil or gas rich on the scale of
Venezuela. It had been known for many
years that the two broad strata of rock (of
the kind likely to bear oil), runs the length
of the Caribbean Basin. Up until the 1980’s,
little interest had been shown in this fact
apart from where such layer coincided with
island masses and this is because the high
cost and technical problems associated with
the recovery of the oil were far beyond the
value of such relatively small quantities of
crude oil. At the time, although there were
existing recovery sites in more shallow
waters that were capable of exploitation,
most geological structures of interest were
far below the Caribbean Sea. Back then,
only very few nations were observed to
have had continental shelves, most of which
dropped off to unreachable depths ranging
from 600-3000 feet.
Since then, new drilling techniques and
methods of platform construction were pro-
posed and introduced. This facilitates off-
Oil/Natural Gas and The Potential of the Caribbean oil industry ........................continued from page 1
Caribbean Petroleum Update : March 2013 | Call: 1-876-927-1779 page 3
C A R I B B E A N E N E R G Y I N F O R M A T I O N S Y S T E M ( C E I S )
shored oil exploration as drilling will now
be able to go beyond 4000ft.
The Caribbean has become strategically and
more attractive to energy investors. The
factors that contribute to this are, the possi-
bility of greater economic instability around
the world, the widening of the Panama
Canal making the Caribbean a north-south
and east-west transit a key trans-shipment
point in the Americas and the opportunity
the region's new deep sea ports and anchor-
ages offers for storage and trans-shipment.
Oil prices have now increased to levels
previously thought of as unthinkable, mak-
ing the cost of deep sea recovery viable.
Demand for energy has increased and will
continue to expand as the industrialization
and wealth of advanced economies continue
to grow. The potential contradictions such
as spills and environmental disasters have
been recognized coming from the experi-
ences in the Gulf of Mexico in 2010. This
has made clear the necessity of the legal
and regulatory frameworks in all nations in
or bordering the Caribbean Sea.
The level of exploitation that is currently
taking place indicates a bright outlook for
the future of Caribbean oil. Some may say
this is far-fetched as the US and other na-
tions are beginning to supply a greater
amount of their energy needs from shale
gas and there is the high probability that
there are huge quantities of oil and gas
beneath the pristine wastes of the Canadian
Arctic. In reality, examining the pace that
the number of global oil corporations have
been investing huge amounts in hope of
getting oil and gas in the Caribbean Basin,
suggests that very soon more than just
Trinidad and Tobago will be a net exporter
of oil or gas producer. Currently, oil explo-
ration is in progress and plans for licensing
have been examined in a number of Carib-
bean countries. At the moment, interests
have peaked in areas off the coasts of
French Guiana, Suriname, Guyana, Belize,
Barbados, The Bahamas, Cuba, Jamaica
and Grenada and in other islands in the
Windward chain.
Image source: http://www.flickr.com/photos/37380310@N04/3887315232/sizes/l/in/photostream/
page 4 Call: 1-876-927-1779 | Caribbean Petroleum Update : March 2013
C A R I B B E A N E N E R G Y I N F O R M A T I O N S Y S T E M ( C E I S )
PP E T R O L E U ME T R O L E U M NN E W SE W S & H& H A P P E N I N G SA P P E N I N G S
JPS preparing report on widespread outage
[...]...read more
Island wide blackout affecting Jamaica
[...]...read more
JPS urges objective evaluation of proposals
[...]...read more
OUR delays decision on power supply proposals
[...]...read more
Safety technology wins Jamaican top us Energy
Industry Award [...]...read more
10% hike in light bills for March [...]...read more
Shell gas stations to rebrand as rubis, ending nine
decades of dominance [...]...read more
Chávez Dead – Venezuela’s Presi-
dent Loses Battle With Cancer –
[...]...read more
How Japan’s ‘flammable ice’ breakthrough
could revolutionize the energy industry
[...]...read more
US Think Tank queries future of Alba, Petro-
caribe without Chávez [...]...read more
Venezuela and the C’bean after Chavez
[...]...read more
Oil deal over a barrel? [...]...read more
Chavez’s death brings hope, uncertainty to
oil patch [...]...read more
Energy News – Mr. Paulwell said…
[...]...read more
Editorial – Life After Chávez [...]...read more
Caribbean Petroleum Update : March 2013 | Call: 1-876-927-1779 page 5
C A R I B B E A N E N E R G Y I N F O R M A T I O N S Y S T E M ( C E I S )
REGULAR UNLEADED GASOLINE AVERAGE PRICES AT THE PUMP
March 2013
Retail prices for Regular Unleaded Gasoline in eight selected Caribbean countries reviewed at the end of March 2013 showed
marginal increases in prices for Dominica, Grenada, St.Kitts, St. Lucia, and Suriname when compared to the previous month
while Antigua and Barbuda remained stable. Of the five countries that experienced increases, Suriname recorded the highest
increase of US$0.17/litre. There were however decreases in prices in March 2013 of 16.7% and 5.6% for Montserrat and St.
Vincent and the Grenadines respectively in comparison to the previous month.
NOTE: *US Gallon = 3.785 L *Imperial Gallon = 4.546 L *As at November 1, 2009 MTBE was phased out from all gasoline blends in Jamaica and replaced with 10% Ethanol.
See prices for all products at See prices for all products at See prices for all products at www.cippet.orgwww.cippet.orgwww.cippet.org
Regular Unleaded Gasoline Average Retail Price (US$/Litre) 2013
COUNTRIES JANJAN FEBFEB MARMAR 3 Mths 3 Mths
AvgAvg
ANTIGUA/ BARBUDA 1.23 1.23 1.23 1.23
DOMINICA 1.18 1.20 1.28 1.22
GRENADA (95 OCT) 1.29 1.29 1.35 1.31
MONTSERRAT 1.38 1.47 1.23 1.36
ST. KITTS/ NEVIS 1.35 1.33 1.35 1.34
ST. LUCIA 1.26 1.26 1.28 1.26
ST. VINCENT/ GRENADINES 1.22 1.22 1.15 1.20
SURINAME [95 OCT] 1.42 1.47 1.64 1.51
page 6 Call: 1-876-927-1779 | Caribbean Petroleum Update : March 2013
C A R I B B E A N E N E R G Y I N F O R M A T I O N S Y S T E M ( C E I S )
International Crude Oil prices over the three months
period Jan-Mar 2013 saw prices in March averaging,
US $92.24/BBL. When compared to the average
prices seen in January and February, this average price
was approximately 1.9% and 4.1% lower respectively.
The highest weekly price seen in March for the prod-
uct was US$93.05/BBL - reflected at the end of the
fourth week. Crude Oil prices seen for March 2013
were the lowest seen over the three months period. An
average of the three month’s average prices reflected
US$94.2/BBL.
Caribbean Energy Information System (CEIS)
primary report of historical annual petroleum energy
statistics provided for 18 Caribbean Countries.
Included are data on total energy production,
consumption, and trade; overviews of petroleum,
natural gas, electricity, as well as financial and
environmental indicators for over twenty years.
US$/B
BL
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88.14
109.61106.0
60
70
80
90
100
110
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Yr Avg
US$
/BBL
Period
Average Monthly World Crude Oil Prices (2010 - 2012)
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