The Weekly Brief: Greater Caribbean


May 11, 2020 edition–Bermuda’s power future; NGC’s new gas supply; and Hocol’s gas discovery.



Last Week in a Minute or Less


Central America. Fitch changed El Salvador’s outlook to negative; and the IMF will help out Honduras.


Greater Antilles / Northern Islands. Bermuda released a report on its power sector future; the Montalva solar project in Puerto Rico continues as planned; and the COVID-19 pandemic halted Punta Catalina’s sale.


Lesser Antilles / Southern Islands. NGC has a new gas supply agreement with Primera Oil and Heritage; Trinidad & Tobago got involved in the US-Venezuela conflict; and Proman will bet on bio-methanol in Trinidad & Tobago.


South America’s Caribbean Coast. Colombia’s Hocol found natural gas in the Bullerengue 3; Venezuela’s crude production is still in decline; and Guyana received its first royalty payment.


Déjà vu all over again. Last week’s readers were particularly interested in Punta Catalina’s unit (Dominican Today – English); El Salvador’s power demand (Central America Data – Spanish); and Heritage Petroleum’s interest in Guyana (Energy Now – English).



Government & NGO


The IMF okayed an FCL for Colombia… The International Monetary Fund (IMF) approved a two-year arrangement for Colombia under the Flexible Credit Line (FCL) for about US$10.8bn (IMF – English). The FCL is designed for crisis prevention purposes while providing flexibility to draw on the line at any time.


…and the IMF will help out Honduras. The International Monetary Fund (IMF) proposed to increase Honduras’ access under the SBA/SCF facilities  by about US$222m, with a total access of US$530m (IMF – English). Honduras’ economy is expected to contract by 3.3%.


The Dominican Republic increased its exports in the first quarter. The Dominican Republic’s exports reached US$2.5bn, a 5.71% jump compared to 2019 (Dominican Today – English). Customs also said that 43.03% of exports were raw materials and 35.84% were consumer goods.


Fitch changed El Salvador’s outlook to negative. The international rating agency changed the outlook for El Salvador’s debt from stable to negative. Fitch maintained the rating at B- (El Mundo – Spanish). The COVID-19 pandemic could affect more than 37% of the GDP (El Mundo – Spanish).



Oil & Gas Upstream


Guyana received its first oil royalty payment. The Finance Minister confirmed that GY$1,040,815,123.60 (US$4.9m), the first royalty payment for Guyana’s crude, was deposited in the country’s Natural Resources Fund (NRF) (DPI – English). The amount adds to the money the country received from the sale of fuel to Shell Western Supply and Trading Limited.


Venezuela’s crude production is still in decline. The Caribbean nation’s oilfields produced 687,000 barrels on May 2 as the Orinoco oil belt production fell by 100,000 barrels per day over three weeks due to a string of wildfires in the storage tanks and pumping stations (Reuters – English).


Colombia’s Hocol found natural gas in the Bullerengue 3. Hocol discovered natural gas in the Bullerengue 3 well, located 30 km away from Barranquilla (Portafolio – Spanish). The company’s goal is to increase gas reserves and strengthen exploration in Colombia.


Bahamian investors covered BPC’s license fees deal. Bahamian investors raised US$900,000 to cover the agreement reached by the Bahamas Petroleum Company (BPC) with the government administration over outstanding license fees (Tribune 242 – English). The company has delayed plans to drill its first exploratory well until October 2020.



Liquid Fuels Mid-Downstream


Trinidad & Tobago got involved in the US-Venezuela conflict. The US government warned Trinidad & Tobago that a Paria Fuel Trading Company ship left Trinidad & Tobago for Aruba but may have eventually been sent to Venezuela, defying US sanctions against the Caribbean country (Stabroek News – English).


The Bahamas’ gas stations got an extension to 5 p.m. Gas station operators will be able to stay open until 5 p.m. even though fuel demand remains down by 60% (Tribune 242 – English). Gas station operators are open to advising the government together with the Bahamas Petroleum Retailers Association.


Two Mexican companies continued an oil-for-food agreement in Venezuela. A vessel with water trucks and equipment sent by Libre Abordo and Schlager Business Group arrived in Venezuela, as part of an oil-for-food agreement signed with Mexico (Reuters – English). The deal is being investigated by the US Treasury and State departments.


Cenit condemns attacks against the Caño Limón pipeline. Ecopetrol’s oil transportation unit, Cenit, said there have been six attacks on the Caño Limón-Covenas pipeline and one against the Bicentenario pipeline (Reuters – English). The company activated contingency plans to avoid contamination of nearby rivers and the surrounding environment.


Venezuela’s oil exports increased in April. The Caribbean nation’s oil exports increased in April after falling in March to the lowest average in seven months (Reuters – English). Venezuela shipped 31 cargoes of crude and refined products in April.


Work to supply the Barrancabermeja refinery continues. The work to dredge and perform supply activities for the Barrancabermeja refinery continues as planned in the Magdalena River (Portal Portuario – Spanish). The work is being done as per biosecurity protocols to protect workers.


Proman will bet on bio-methanol in Trinidad & Tobago. Proman sent a proposal to the Energy Ministry to produce bio-methanol using municipal waste from Trinidad & Tobago’s landfills (Energy Now – English). The process would help reduce carbon dioxide emissions.



Natural Gas Mid-Downstream & LNG


NGC agreed to a new gas supply deal with Primera Oil and Heritage. NGC signed a framework agreement with Primera Oil and Gas Limited Heritage Petroleum Company to create plans and partnerships pertaining to the development, sale, and purchase of natural gas and natural gas liquids produced from the Ortoire Block (Energy Now – English).


Jamaica’s conversion to LNG left it out of oil savings… Jamaican power customers are not enjoying the fall in oil prices due to the switch toward LNG to produce electricity. JPS argued that LNG pricing tends to be much more stable than the price of oil (Jamaica Gleaner – English).


…and New Fortress defended gas over oil. Despite the fall in oil prices, New Fortress Energy argued that natural gas assets will remain competitive due to lower maintenance costs and the expectation of a recovery in oil prices (Jamaica Gleaner – English).



Electric Power & Renewables


Bermuda released a report on its power sector future. The Regulatory Authority (RA) published a preliminary report on the future of the electricity sector and asked the public’s opinion by June 2 (Royal Gazette – English). Proposals from the RA included that its functions should “explicitly include the promotion of clean energy.”


The Montalva solar project in Puerto Rico continues as planned. Despite the COVID-19 pandemic, the construction of the Montalva solar project in Puerto Rico continues as scheduled. The project would launch with 80MW AC of photovoltaic and the capacity to expand up to 165MW AC (New Energy Events – English).


Colombia’s Sucre will shine brighter. The construction of the La Sierpe solar park started in February and will be operational by the end of the year (PV Magazine – Spanish). The plant will have a capacity of 26MW and it is located in the San Benito Abad municipality.


The COVID-19 pandemic halted the sale of Punta Catalina. Although the financial and technical information is ready, the process to sell half of Punta Catalina’s shares has been postponed until after the presidential elections scheduled for July, when greater economic dynamism is expected (Dominican Today – English).


Bermuda’s airport will have a solar farm. The Regulatory Authority approved an operating license for the electricity generation plant, built on the “finger” at the airport. The plant is expected to go online in the upcoming months (Royal Gazette – English).



Old School Social Goes Viral


(Editor’s note: For the duration of the COVID-19 outbreak, this section will refocus on announcements of event delays or cancellations, events that are moved online, and scheduled webinars and public conference calls. Stay safe!)



The Latam Mobility Summit will be held June 10-11 at Orquideorama, Botanical Garden, in Medellín.


The South America Energy Series is scheduled for June 20 at JW Marriott in Bogotá.


The SPE Latin American and Caribbean Petroleum Engineering Conference was rescheduled to July 28-30 at the Ágora Convention Center in Bogotá.



Lateral Thinking


Puerto Rico was shaken by a 5.5 earthquake. Puerto Rico suffered a 5.5 magnitude earthquake on the southern coast near Yauco and Ponce (Express – English). Several tremors have rocked the region, but there was no tsunami warning for Puerto Rico.



Quote of the Week


“The fundamental truth of my life, the principle that governs it, is that nobody has a monopoly over the truth.”


– Rosario Ferré (1938-2016), Puerto Rican writer and poet.



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