BP’S DECLINE ANOTHER ECONOMIC BLOW

BP, once the biggest investor in Trinidad and Tobago, is realigning its operations in the midst of continuously dwindling returns.

The multinational is selling off production assets and looking to reduce costs in all areas of its T&T operations, which were once the pearl of bp’s global investments.

Workers are expected to be sent home, in the biggest layoffs since 2020, when more than 100 employees lost their jobs.

The company is still working on an offshore natural gas field, in partnership with EOG, and there are moves to further focus on deepwater areas.

But the future is unsure for bp T&T, which once contributed a healthy 12 per cent of the company’s global production.

The energy firm had previously announced its divestment from three fields – Amherstia, Cashima, and Immortelle – reducing its production by some 200 million cubic feet per day (mcfd).

That amounts to 15 per cent of its daily production.

The French company Perenco is expected to buy these fields, which have experienced lower returns in recent years.

Investments in LNG, power generation and methanol have been shed, and bp’s output of 1.3 mcfd is about half of what it produced at the peak of its operations in T&T.

As recently as 2002, as much as 18 per cent of bp’s LNG production came from T&T and boosted the performance of Atlantic LNG.

The company has said it is committed to exploring in T&T’s deep-water areas, with Woodside Energy, and is involved, with Shell, in east-cost operations.

In addition, there are also Block 5B cross-border activities with Venezuela.

There is focus on developing the Manakin-Cocuina field but the United States’ embargo on Venezuela is a major stumbling block.

Generally, bp’s strategic divestment and the overall dramatic slowdown of its operations are cause of anxiety for bp and T&T.

The company has been a primary taxpayer, and its declining throughput has contributed to the foreign exchange crisis.

In recent years, tax payments have declined from the 2018 peak of $2.4 billion.

With as many as 16 offshore platforms, bp employed scores of energy experts and provided training, generous employee welfare and other support.

There have also been significant contributions to sports and culture.

Top steelband bp Renegades remains its flagship.

Investments have been made in community and youth activities in Mayaro and Guayaguayare.

But David Campbell, President of bp Trinidad and Tobago, has noted the current uncertain state of affairs.

Campbell said last September:  “Increasing natural gas production needs to be this country’s priority…”

He stated that the company is “focused on securing T&T’s energy future.”

That means unlocking the potential of deep-water acreage.

That is a demanding and unsure future, especially since, as Campbell said, “the world is demanding energy that is lower carbon.”

There is much concern bp over its future in T&T, but whatever it is, it is unlikely to be like the glory days of peak natural gas production.

It is another sign of the economic times as the country’s energy sector continues to decline.