The Weekly Brief: Greater Caribbean

January 8, 2018 edition—AES Colon coming; Petrotrin A&V contract ending; and Stabroek producing by 2020.




Last Week in a Minute or Less


Central America. AES Panamá is almost done with Colon’s power plant; fuel prices went up in El Salvador; and Nicaragua will pay more for power.


Greater Antilles. The Dominican Republic’s Electrical Pact caused a debate over the holidays; Cuba will develop more solar parks; and the CDB announced a US$100m program in Haiti.


Lesser Antilles. Petrotrin terminated its contract with A&V; Grenada asked for energy sector reform; and Anguilla will enjoy a restored power system.


Northern South America. ExxonMobil will start Stabroek production in March 2020; Ecopetrol found light crude in Santander; and Brazil is interested in Guyana’s oil sector.


Déjà vu all over again. Last week’s readers were particularly interested in Bermuda’s fuel policy (English); St. Kitts and Nevis’ development (English); and the IDB’s efforts to make the Caribbean a “climate-smart zone” (English).



Political Economy


Grenada asked for energy sector reform in the Caribbean. Grenada’s Prime Minister, Dr. Keith Mitchell, stated that the greatest potential to transform the Caribbean economies is in the region’s energy sector (English). The goal is to eliminate fossil fuel imports and use 100% renewable energy by 2030.


The CDB had a busy holiday break. The Caribbean Development Bank (CDB) approved US$5m to support climate-smart agriculture in Grenada (English) and improve Suriname’s agricultural competitiveness (English). The CDB also announced US$100m for an assistance program in Haiti from 2017 to 2021 (English).


Latin America’s elections can affect energy reforms. The region’s top oil producers will hold presidential elections that could bring energy policy changes (English). The presidential elections could be decisive in maintaining oil revenues in countries such as Brazil and Mexico, where certain candidates are against the current oil policy.


The IMF concluded its visit to Dominica and the Bahamas. The International Monetary Fund (IMF) concluded the Article IV consultation with Dominica and projected it would grow 3% in 2018 (English). The IMF also finished the Article IV consultation with the Bahamas, projecting 2.5% growth in 2018 (English).


Cuba delayed the end of Castro’s presidency. Raúl Castro will leave the presidency in April, two months later than anticipated (English). The transition was postponed due to the delay in legislative elections as a consequence of the damage caused by Hurricane Irma.




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Oil & Gas Upstream


Petrotrin terminated its contract with A&V. Petrotrin announced the termination of its contract with A&V Drilling and Workover Limited due to discrepancies in oil production revealed by its Internal Audit Department (English) (English). Kroll Consulting Canada Company confirmed the findings of Petrotrin’s audit department.


Brazil is interested in Guyana’s oil sector. Petrobras is considering entering Guyana’s oil and gas sector, noting that the company was engaged with Guyana during the 80s and the 2000s (English). President Granger said he welcomes investment from Brazil in that sector.


ExxonMobil will start Stabroek production in March 2020. ExxonMobil announced oil production at the offshore Stabroek block will begin in March 2020, producing between 100,000 and 120,000 barrels per day, a fraction of the Liza field (English). Guyana’s government was under pressure to disclose the 2016 agreement, which renegotiates the terms signed in 1999.


Ecopetrol struck black gold in Santander. The state-run oil company, in joint exploration with Canada’s Parex, announced the presence of oil in the Santander province near La Cira-Infantas (English). The Coyote-1 deposit, between 2,042 meters and 2,177 meters deep, contains crude that is lighter than the normal Colombian oil.



Oil & Gas Downstream


US LNG exports look south. Latin America is becoming a growing market for US LNG exports, according to the deputy assistant secretary at the US Department of State’s Bureau of Energy Resources. Companies are preparing investments for 2019, with volumes depending on market demand (English).


The Dominican Republic started 2018 with higher fuel prices… The Ministry of Industry, Commerce, and Small and Medium-sized Businesses announced an increase in fuel prices of between RD$1.00 and RD$3.50 during the first week of 2018 (English). Premium gasoline experienced the highest rise, ending up at RD$223.30 per gallon.


…and El Salvador’s fuel prices contributed to the post-holiday budget crunch. The Economy Ministry announced a 1.4% increase in fuel prices, with a gallon of regular gasoline selling between US$3.12 and US$3.17 (Spanish). Falling US oil inventories at the end of 2017 contributed to the price increase.


Colombian oil exports skyrocketed in November. The value of Colombia’s November petroleum exports jumped 17.3% relative to a year ago, propelling the country’s overall export balance (English). Oil exports from January to November were 30.1% above 2016 levels, a sign of recovery for Colombian commerce.



Renewables & Electricity


AES Panamá is almost done with Colon’s power plant… The natural gas power-generating plant, AES Colón, was 93% complete by November (Spanish). Construction started in May 2016 and AES Panamá is close to concluding several key construction phases.


…and Panamá NG’s thermoelectric power plant was cancelled. The permit handed to Panamá NG Power to build a 670 MW thermoelectric plant was cancelled (Spanish). The license was awarded in 2011. The decision to cancel the plant will affect the supply contracts signed with EDEMET, EDECHI, and ENSA.


DR Electrical Pact stirred up a quarrel over the holidays. The signing of the Electrical Pact, scheduled for December 21, was postponed to January by the Economic and Social board due to lack of support (Spanish). Santo Domingo and the Herrera industrial sector said the pact does not solve the country’s power problem (Spanish).


Anguilla will enjoy a restored power system. The Caribbean Development Bank (CDB) approved a US$5m fund to support the Anguilla Electricity Company Limited (ANGLEC) to restore its transmission and distribution system (English). Hurricane Irma disrupted the island’s electricity and water supply.


Cuba bets on solar energy. Camaguey province will expand its use of renewable energy sources through a new photovoltaic park, providing 2.2 MW (English). Cienfuegos ended 2017 with 16MW of capacity from five solar parks built in the province (Spanish).


Panama and Nicaragua will pay more for power in 2018. More than 800,000 Nicaraguan power consumers will see higher power tariffs due to the government’s compromise with the IDB (Spanish). Panamanian clients consuming over 301kWh per month will pay just under half a cent more per kWh (Spanish).



Old School Social


Events in the world beyond your screen—go see and be seen!


The Trinidad and Tobago Energy Conference 2018 is January 22-24 at the Hyatt Regency in Port of Spain, Trinidad & Tobago.



Lateral Thinking


BVI will develop a project to resist floods. Three communities in the British Virgin Islands (BVI) will build their resilience to flooding resulting from climate change (English). Communities at Tortola and Jost Van Dyke will be part of the Establishing Flood-Resilient SMART Communities, a project financed by the Caribbean Development Bank.



Quote of the Week


“Forgiving is not forgetting. Forgiving is remembering without pain.”


-Celia Cruz (1925-2003), Cuban-American singer awarded the National Medal of Arts in 1994 and named the “Queen of Salsa.”



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