The Weekly Brief: Greater Caribbean


April 2, 2018 edition–Jamaica’s 3D seismic survey; Guadeloupe’s geothermal potential; and Colombia’s oil spill.




Last Week in a Minute or Less


Central America. AES will update El Salvador’s power; and Nicaragua wants to go almost completely green by 2020.


Greater Antilles. Jamaica received a 3D seismic survey and doubts surround its future refinery; and the Finance Ministry trusts the Dominican Republic’s growth.


Lesser Antilles. Repsol gave Seadrill work in Aruba; Guadeloupe and Dominique will be powered by geothermal energy; and Bermuda’s East End will have a new power plant.


South America’s Caribbean Coast. Ecopetrol is fighting an oil spill; ENI and Exxon expanded their interest in Guyana; and PDVSA programmed a crude upgrader shut down.


Déjà vu all over again. Last week’s readers were particularly interested in the White House ban on Venezuela’s digital currency (English); Grenada’s gas and oil find (English); and PdVSA’s freed oil cargo (English).



Political Economy


The IMF had a busy week. The International Monetary Fund (IMF) said the Bahamian economy “has turned the corner” (English), while finding deficiencies and weaknesses in the tax administration system (English) of Trinidad and Tobago. Antigua and Barbuda paid off the nation’s debt (English) to the IMF before the general election.


The CDB okayed US$50m for the BVI. The Caribbean Development Bank (CDB) approved a US$50m loan to the British Virgin Islands to restore economic stability (English) and build resilience after the passage of Hurricanes Irma and Maria in 2017. The damage from both hurricanes was estimated at over US$3.6bn.


El Salvador’s GDP is lower than expected. The central bank is using a new system of national accounts to measure the GDP, the international standard most used to assess economic performance. The change in methodology made the economy 12% smaller than under the previous system (Spanish).


The IADB forecast 2.6% growth between 2018 and 2020. Despite low levels and poor quality of investment (Spanish) in Latin America and the Caribbean limiting the economic growth in the region, the Inter-American Development Bank expects the region to grow 2.6% on average between 2018 and 2020.


The Finance Ministry trusts the Dominican Republic’s growth. The Finance Ministry forecast 5% growth in the Dominican Republic for 2018 and 2019 (Spanish). The reason is the stability of the economy considering US economic projections, the country where 74% of the remittances originate and the destination of 48% of DR’s exports.


Public investment dropped and slowed Latin America: Cepal. The executive secretary of Cepal warned that the drop in public investment in the last few years will limit growth in Latin America and the Caribbean. The cut in public investment lowered Latin America’s GDP to 3.5% in 2017, down from 3.7% in 2016 (Spanish).



Oil & Gas Upstream


ENI and Exxon expanded their interest in Guyana. The Italian company met the Natural Resources Minister to discuss a packaged plan of action from ENI in the country (English). Exxon and its partners are considering a third floating production storage and offloading vessel (English) for Guyana.


Jamaica receives a 3D seismic survey. The Polarcus Adira, a 3D seismic vessel, is in Jamaica and will determine the direction of the oil and gas exploration program (English) of the Petroleum Corporation of Jamaica (PCJ). The PCJ is taking all measures to ensure environmental preservation (English) during the search for oil and gas.


Repsol handed Seadrill work in Aruba. Repsol awarded Seadrill the contract for the West Capella, an ultra-deepwater drillship (English) to be used offshore Aruba. The West Capella, with a capacity to drill to 35,500 feet, is currently in West Africa and will be available in June.


Ecopetrol is fighting an oil spill. Ecopetrol is developing emergency measures in Colombia to stem an oil spill near Barrancabermeja that reached the Sogamoso River (English). Oil escaped the Lizama 158 oil field on March 3 (English), but Ecopetrol sent heavy equipment to stop the spill on March 24.


Guyanese campaigners will fight oil giants. Guyanese campaigners challenged three major oil companies, Exxon Mobil, Hess Corporation, and Nexen (English), in court in Guyana. The Guyana government is satisfied that all legal requirements were satisfied (English) when issuing a petroleum production license.



Oil & Gas Downstream


Another expert warned Guyana over its planned refinery… British oil and gas expert Sir Paul Collier, CBE, FBA, warned the Guyana government against building an oil refinery (English). British oil industry expert Michael Boyer and Pedro Hass had also advised the government against the refinery due to logistical and economic reasons.


…and doubts surround the Bahama’s refinery. Some business and oil industry insiders doubt the viability of the market for an oil refinery (English) in the Bahamas. Concerns surround the environmental impact of the project and the feasibility study. The Bahamas Oil Refining Company International decided the market could not sustain an oil refinery.


PDVSA will shut down a crude upgrader. Venezuela’s state-owned company plans to stop an oil upgrader for maintenance. PDVSA requires higher imports of diluents (English) for its extra heavy oil output.



Renewables & Electricity


The CDB will give Dominica a hand in restoring power. The Caribbean Development Bank (CDB) will provide US$16m (English) in funding to the Dominica Electricity Services Limited (DOMLEC) to restore electricity generation services. Hurricane Maria destroyed or damaged 75% of Dominica’s electricity sector.


AES will update El Salvador’s power. AES will invest US$33.1m this year to improve the quality and the coverage of the power grid (Spanish) and replace 50,000 digital meters (Spanish). The goal of the distributors is to provide better service to 1,380,000 clients.


Guadeloupe and Dominique go into geothermal energy. Teranov was granted geothermal exploratory licenses for three years by Saba and St Eustatius (English) in the Dutch West Indies. The Dominica ambassador told the Organization of American States that Dominica will have its first geothermal plant by 2020 (French).


Nicaragua bets on clean energy. Nicaragua plans to reach 90% of renewable generation by 2020 (Spanish). To reach that goal, Nicaragua must increase its electricity production to 1,276 MW: 616 MW from hydroelectric energy, 168 MW from biomass, 143 MW from wind energy, 135 MW from geothermal sources, 74 MW from solar energy, and just 140 MW from bunker fuel.


Bermuda’s East End will have a new power plant. Marginal Wharf in St. David’s will enjoy a new power plant and cargo port. The plant will cost US$150m and will provide 20MW of power (English).



Lateral Thinking


The Caribbean hummingbirds’ weaknesses are determined by the environment. A new study from the University of Copenhagen has found that the vulnerability and specialization of Caribbean hummingbirds are determined by their environment (English). Hummingbirds in mountainous landscapes are more vulnerable to extinction than hummingbirds in the lowlands.



Quote of the Week


“(Breaking) ritual habit, ritual normality that seals our eyes and ears…you can advance, see things you never saw before, move out of boundaries that have been a prison.”


-Sir Theodore Wilson Harris (1921), Guyanese writer. Quote from “Redemption song,” Maya Jaggi, The Guardian, December 16, 2006.



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