February 18, 2019 edition–Panama’s largest solar; Tullow’s drilling in Guyana; and Puerto Rico’s offshore wind.
Last Week in a Minute or Less
Central America. Panama cut the ribbon on its largest solar plant; El Salvador encourages renewables with tax benefits; and the end of the free trade agreement between El Salvador and Taiwan hit sugar producers.
Greater Antilles. Jamaica introduced legislation to recover shares in Petrojam; the Venezuelan crisis may affect Cuba’s investments; and Puerto Rico considers offshore wind energy.
Lesser Antilles. The IMF is proud of Barbados; and Trinidad & Tobago may develop a tax reform to boost oil output competition.
South America’s Caribbean Coast. Tullow will speed up its Guyana drilling program; Venezuela’s oil production dropped; and Saudi Arabia, Venezuela, and India trade fuels before the US sanctions hit.
Guaidó set an aid entry date against Maduro’s refusal. Venezuela’s opposition leader Juan Guaidó announced before his supporters that humanitarian aid would enter Venezuela on February 23 (English). President Maduro has refused to let supplies in the country.
The IMF visited Barbados. The International Monetary Fund said Barbados continues working and improving on implementing its economic reform program (English). The government is preparing a budget with a primary surplus of 6% of GDP and continues having discussions with external creditors.
The end of free trade between El Salvador and Taiwan hit sugar production. The government of El Salvador explained to sugar producers the terms to conclude the free trade agreement with Taiwan. The producers explained that the end of the agreement will hit their production and menaces agreements with Taiwanese buyers worth US$23m (Spanish).
The IDB is helping Guyana to strengthen its Energy Ministry. The Finance Minister signed two loans with the Inter-American Development Bank to the value of US$31m. The first will establish an Electronic Single Window for trade and the second is titled “Energy Matrix Diversification and Institutional Strengthening of the Energy Department” (English).
The Venezuelan crisis may hit Cuba’s investments. The US is considering activating a law that would expose companies to lawsuits for trafficking in expropriated Cuban property (English). Investors are rethinking their future interest in Cuba, and foreign businesses in Cuba are facing difficulties defending their interests.
Oil & Gas Upstream
Venezuela’s oil production dropped again. The US Energy Information Administration estimates that Venezuela’s production dropped to 1.22 million barrels per day in January from 1.25 million barrels per day in December (English). IHS Markit expects Venezuela’s production to drop to 700,000-900,000 barrels per day in 2019 because of US sanctions (English).
Tullow hit the gas on drilling in Guyana… Tullow Oil will start its drilling program in Guyana in the second quarter, instead of the end of this year (English). The reason is the recent findings made by ExxonMobil in the area.
…and the area is being touted as an emerging petroleum province. Explorers are rushing to get a share of the action, offering security investors an opportunity to profit on the oil rush (English). Previous new frontiers were West Africa in the 2000s, East Africa in the early 2010s, and now Guyana.
Trinidad & Tobago may develop a tax reform to boost oil output competition. Oil companies asked the Trinidad & Tobago government to change its supplemental petroleum tax on oil production (English). The companies argue the current tax discourages oil exploration.
Oil & Gas Downstream
Europe’s oil market may feel the Venezuelan sanctions… The European fuel oil market has shown strength this winter and analysts expect traders to eye shipments to the US to compensate for the effect of Venezuelan supplies and sanctions (English).
…and the oil sanctions left more than 20 tankers hanging. In recent days, approximately 20 tankers with 9.6 million barrels of Venezuelan oil have arrived to the US Gulf Coast. Some buyers purchased the cargoes ahead of the US sanctions and others are considering how to pay under the new circumstances (English).
Saudi Arabia, Venezuela, and India are trading fuel before the US sanctions hit. A Saudi oil tanker is going to Venezuela to pick up a cargo for a customer in India to be delivered before US sanctions go into force (English). Venezuela is strengthening oil ties with India to avoid US sanctions (English).
Jamaica introduced legislation to recover shares in Petrojam. Prime Minister Andrew Holness will present legislation to retake the 49% stake held by Venezuela’s PDV Caribe in Petrojam (English). Senator Kamina Johnson Smith discussed the reasons for the legislation in a statement, explaining the possible implications of the decision (English).
The GRA had a busy week. After being accused of encouraging fuel smuggling, the Guyana Revenue Authority assured it is fighting fuel smuggling and takes no political directives (English). The GRA also questioned the false online report that an IMF Petroleum Taxation Consultant accused the institution of data integrity issues (English).
Renewables & Electricity
Panama cut the ribbon on its largest solar plant. The President of the Republic opened the IKAKOS solar park, the biggest in the country in Chiriquí, David. The plant will contribute 84.58 GWh to Panama’s grid with 138,960 solar panels (English).
Puerto Rico considers offshore wind energy. Puerto Rico’s congresswoman Jennifer González-Colón introduced a bill to study the potential for offshore wind energy (English). Puerto Rico’s Electric Power Authority (Prepa) published a draft of the 2019 integrated resource plan, establishing the future development and recovery of Puerto Rico’s electric grid (English).
El Salvador encourages renewables with tax benefits. El Salvador’s first wind park will enjoy tax exemptions for 20 years (Spanish). Ventus will invest US$73.23m over 10 years to install and operate the park with a capacity of 54MW.
The Dominican Republic will enjoy 2,025 new MW. The CEO of the State Electric Utility (CDEEE) said that 2,025MW will be added in 2019 to the national grid. The goal is to normalize the power service with enough energy to have sustainable prices (English).
Old School Social
Events in the world beyond your screen—go see and be seen!
RECAM is scheduled for March 5-7 at the Hilton Panamá Hotel in Panama City.
Marine life is moving from the tropics to the poles. For a long time, scientists thought there were higher levels of marine biodiversity in the Caribbean than in polar waters. US researchers found that “endotherms” (animals that warm their bodies by having high metabolisms) enjoy the cold (English).
Quote of the Week
“Reconciliation is more beautiful than victory.”
– Violeta Chamorro (1929) Nicaraguan politician and former president.
We hope you have a productive week. Please send any news, comments, or reasons to move to the poles to CaribbeanWeekly@energynarrative.com.
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