The Weekly Brief: Greater Caribbean


March 11, 2019 edition– Guatemala’s power auction; Ecopetrol’s deal; and Jamaica’s pipeline.




Last Week in a Minute or Less


Central America. Guatemala launched its power auction; Costa Rica plans to renegotiate power contracts; and the BCIE will invest US$50m in Panamá’s power.


Greater Antilles. Jamaica found no illegal connections on its underwater pipelines; Puerto Rico okays the regulatory energy framework; and BPL unveiled a US$95m power plant deal.


Lesser Antilles. St Kitts and Nevis and the EU partnered up on renewables; and the EU plans to broaden its tax haven blacklist, including Bermuda.


South America’s Caribbean Coast. Ecopetrol signed a deal for an offshore block; Apache will drill an offshore well in Suriname; and the Caño Limón pipeline was bombed yet again.


Déjà vu all over again. Last week’s readers were particularly interested in PDVSA’s spot crude (English); Punta Catalina’s coming online (English); and the Beauséjour wind park (French).



Political Economy


Jamaica will give a hand to small businesses. The Jamaican government plans to access US$390m in dormant bank accounts to provide low-interest financing to micro, small, and medium-sized enterprises (English). Access to affordable financing has been a constraint to small business growth.


CARICOM and the EU disagree on tax compliance. The Caribbean Community Secretary-General Ambassador said that the ever-changing parameters for good tax governance established by the European Union are infringing on the region’s sovereignty (English). The requirements surpass those established by the OECD.


The US is considering new sanctions against Venezuela. The US is considering new sanctions on Venezuela to pressure President Nicolás Maduro’s government to leave power (English). The Trump administration implemented a new Cuba policy allowing US citizens whose property was stolen by the Castro regime to sue Cuban companies (English).


The EU plans to broaden its tax haven blacklist, including Bermuda. The European Union added 10 jurisdictions to a draft tax haven blacklist, including Bermuda, tripling the number of listed countries (English). The existing list includes Trinidad and Tobago and the US Virgin Islands.



Oil & Gas Upstream


Ecopetrol signed a deal for an offshore block. Ecopetrol signed an offshore exploration and production deal for a 400,000-hectare block in the Caribbean (English). Ecopetrol will invest more than US$250m in the project and will develop two exploratory wells.


Apache will drill an offshore well in Suriname. Apache expects to drill the first exploration well on block 58 offshore Suriname around June (English). The company has identified numerous large prospects across multiple different play concepts.


ExxonMobil increased Guyana’s reserves another 10%. ExxonMobil increased its resource estimate of its deepwater Guyana Stabroek block to 5.5 billion boe, from 5 billion in December (English). The Yellowtail and Tripletail prospects will be the next in Guyana.


Ecopetrol will invest US$500m in fracking. The state-run company plans to spend US$500m to explore unconventional deposits in the next three years (English). Ecopetrol will apply to drill 20 wells.



Oil & Gas Downstream


Ecopetrol disconnected its polyethylene units. Ecopetrol put its polyethylene operations offline for maintenance due to feedstock issues from an incident at the Barrancabermeja refinery (English). The company placed the low-density polyethylene units on a 10-day maintenance plan.


PDVSA spot crude offers rose. The Venezuelan state-owned company has 10.8 million barrels of crude sitting dockside without a buyer (English) due to US sanctions. PDVSA has accumulated 10 additional shipments of Mesa 30, Anaco Wax, and Merey 16 crude without a buyer.


Jamaica found no illegal connections on its underwater pipelines. The Jamaica Defence Force Coast Guard found no illegal attachments to Petrojam’s underwater petroleum pipelines (English) on the 23 pipelines surveyed by 14 divers.


The Caño Limón pipeline was bombed yet again. A bomb damaged a section of Colombia’s Caño Limón pipeline in the Arauca province, the tenth attack on the pipeline in 2019 (English). The oil spilled by the bombing was contained in the crater created by the explosion.



Renewables & Electricity


Guatemala launched its short term power auction. Empresa Eléctrica de Guatemala launched an auction to buy 71MW from generation plants for the period between May 1, 2019 and April 30, 2020 (Spanish). The goal is to guarantee service for 1.2m users (Spanish).


Costa Rica plans to renegotiate power contracts. The Costa Rican Power Institute plans to cut costs, improve prices, and adjust power purchases to match demand by renegotiating contracts with private generators (Spanish). The opportunity to review the contracts comes with the expiration date of a hydroelectric plant contract in June.


BPL unveiled a US$95m deal for a power plant. Bahamas Power & Light (BPL) announced a deal for an upgrade of its New Providence generation capacity (English). BPL will probably take an equity ownership interest in Shell’s new power plant in return for the US$95m emergency generation investment (English).


St Kitts and Nevis and the EU partnered up on renewables. St Kitts and Nevis signed a Sector Budget Support Program with the European Union for US$5.6m to boost energy self-sufficiency from renewable energy (English). The program will last three years and will help to build resilience in the energy and water sectors.


Puerto Rico okays its new regulatory energy framework. Puerto Rico’s House and Senate discussed their differences and created a single version of Senate Bill 1121 (English). The committee eliminated a House amendment of a 20% cap in power rates by 2020.


The BCIE will invest US$50m in Panamá’s power. The Central American Bank of Economic Integration (BCIE) will lend US$50m to the Power Transmission Company (ETESA) to increase the country’s power infrastructure (Spanish). The goal is to satisfy growing demand and to maintain safe and reliable infrastructure.


The Dominican Republic could cut consumption by 13.2%. Energy and Mines Minister Antonio Isa Conde said that if the National Energy Efficiency Plan is applied, the Dominican Republic could save 3,276 gigawatt-hours per year, a 13.2% cut in consumption through 2030 (English).



Old School Social


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



REFFLATAM 2019 will be held March 11 at the South Beach Hotel in Miami.


RECAM is scheduled for March 12-13 at the Hilton Panamá Hotel in Panama City.


Solar Power Florida will be held March 12-13 at the Bahia Mar Fort Lauderdale Beach in Ft. Lauderdale.


The 2nd Annual Guyana International Petroleum Business Summit & Exhibition 2019 is scheduled for March 26-28 at the Guyana Marriott Hotel in Guyana.



Lateral Thinking


Ocean heat waves are hitting Caribbean habitats. Researchers found that ecosystems, such as corals and seagrass, suffer under marine heat waves (English). Corals tended to bleach, becoming vulnerable to death, while seagrass grew at lower densities.



Quote of the Week


“El hombre es una especie que falló como especie, un ser dedicado a destruir el medio en que vive”


“The human being is a species that fails as a species, a being devoted to destroying the environment in which he lives.”



– Álvaro Mutis (1923-2013), Colombian poet and novelist.



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