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October 8, 2018 edition–Ecopetrol’s Brazilian block; Petrotrin’s end; and El Salvador’s renewables.
Last Week in a Minute or Less
Central America. All eyes are on El Salvador’s renewables; Guatemala hit the brakes on hydropower projects; and Nicaragua’s crisis affected power demand.
Greater Antilles. The Dominican Republic will have more power plants, but businesses are concerned about rising oil prices.
Lesser Antilles. Petrotrin will cease operations by the end of November; Bermuda may enjoy a floating natural gas power station; and the IMF okayed the Barbados’ economic recovery plan.
South America’s Caribbean Coast. Ecopetrol will explore the Pau-Brazil oil block; Venezuela’s oil production keeps declining; and Canacol sold its Colombian assets to Arrow Exploration.
Déjà vu all over again. Last week’s readers were particularly interested in AES Dominicana’s biggest power plant (English); Panama’s sugar power plant (Spanish); and renewable energy investment requests (Spanish).
Political Economy
El Salvador is low on domestic and foreign investment. In the first six months of the year, El Salvador attracted ES$287m in foreign direct investment, ES$118m less than in the same period of 2017 (Spanish). If the 2019 budget is approved, public investment will amount to only 3.7% of the GDP (Spanish).
S&P expects great things from Guatemala. Standard & Poor’s is optimistic about the performance of Guatemala’s national economy, expecting to maintain the BB- rating (Spanish). The Monetary Board maintained the interest rate at 2.75%.
The IMF okayed the Barbados’ economic recovery plan. The International Monetary Fund approved the plan that will give Barbados access to US$290m over four years, with US$49m being immediately available (English). The debt restructuring will complement the government’s fiscal consolidation (English).
Venezuela’s migration crisis continues. Millions of Venezuelans have left the country since 2015, heading over the border to Colombia or other countries in the region (English). The United Nations agencies estimate that 2.3 million people left Venezuela in the last three years (English), but others put the number as high as 4 million, equal to one in eight Venezuelans.
Oil & Gas Upstream
Ecopetrol will explore the Pau-Brazil oil block. The Colombian state-owned company was one of the winners at the auction to extract oil from the Santos basin off the coast of Brazil (English). Ecopetrol, BP, and China National Offshore Oil Corporation will pay around US$125m to the Brazilian government to explore the Pau-Brazil block.
The GRA trains customhouse brokers on oil and gas. The Guyana Revenue Authority started training 139 potential customhouse brokers, including an understanding of oil and gas, with facilitators from within the GRA’s Oil and Gas Unit and an external counterpart (English).
Mexico’s oil and gas experience may guide Guyana. The Executive Director of the National Agency for Industrial Safety and Environmental Protection (ASEA) in Mexico said Guyana could benefit from Mexico’s experience in the oil and gas sector (English). Mexico’s experience may help Guyana decide how to best harness the oil and gas industry.
Despite China’s help, Venezuela’s oil supply keeps declining. Venezuela’s crude oil production fell by 36,000 barrels per day from July to an average 1.235 million barrels per day in August, compared to the average 1.911 mbpd for 2017 (English). More than US$9bn in sovereign bond payments are due in 2018.
Canacol sold its Colombian assets to Arrow Exploration. The Canadian company sold its oil assets in Colombia to Arrow Exploration for US$40m to focus on natural gas exploration and production (Spanish). The sale includes crude oil fields with a net production of 1,375 barrels of crude per day and almost 8.6 million barrels of proven reserves.
Oil & Gas Downstream
Petrotrin will cease operations by the end of November. The Trinidad & Tobago state-owned oil company will close its operations on November 30, discarding the plan by the Oilfield Workers Trade Union (OWTU) to make the oil refinery operational (English). The company had said the union would review the proposal.
Guyana seized illegal fuel. The Law Enforcement and Investigation Division (LEID) of the Guyana Revenue Authority intercepted a motor vessel listed for “fishing purposes” with 80,000 liters of diesel fuel (English). The GRA has undertaken a relentless approach against smuggling.
Dominican Republic businesses are concerned about rising oil prices. The industries association president warned that the Dominican Republic is very dependent on oil, and the continuous increase in fuel prices could increase the cost of living. The business leader urged all the sectors to come together to discuss and find solutions (English).
Venezuela’s oil exports literally crashed. A dock at Venezuela’s José oil port was closed in late August after a tanker collided with it (English). The repairs will delay the delivery of 5 million barrels of crude to Rosneft.
The Bahamians suffer the most from fuel prices. The Inter-American Development Bank (IDB) analyzed the impact of energy taxes and subsidies in 11 countries and found that, besides Ecuador, 40% of Bahamians are among the hardest hit in the Latin American and Caribbean regions by any increase in fuel prices (English).
Renewables & Electricity
El Salvador bids for renewables, while Guatemala hits the brakes on hydropower projects. At least 16 companies will compete in the auction of 28MW of renewable energy to generate solar and biogas power (Spanish). Due to social conflicts with local communities in Guatemala, 16 hydropower projects with a capacity of 460MW have been halted (Spanish).
Nicaragua’s crisis affected power demand. The socio-political crisis has affected the country’s power demand, dropping by 18.4% compared to March and 17% compared to the same month in the previous year (Spanish). In the industrial sector, several projects have been abandoned and several companies have closed temporarily, reducing power demand.
Bermuda may enjoy a floating natural gas power station. An offshore floating natural gas power station was suggested among the eight alternative electricity generation proposals presented to the Regulatory Authority of Bermuda (English). Included among the alternative proposals are an offshore wind farm and a steam-fired power station using biomass fuel technology.
The Dominican Republic will have more power plants. A judge allowed Emerald Solar to continue the construction of the solar power plant in Vicente Noble (Spanish). AES Andrés restarted operations with 110MW and the wind park Larimar II will contribute with 48.3MW (Spanish).
Old School Social
Events in the world beyond your screen—go see and be seen!
Energía Colombia 2018 is scheduled for October 23-24 at the J. W. Marriott Bogotá in Bogotá, Colombia.
The Renewable Energy Training Course in Photovoltaics and Bio-Energy will be held October 29-November 2 at the Wigton Windfarm Office in Jamaica.
Lateral Thinking
Scientists raised baby corals to reforest the Caribbean. Scientists are gathering baby corals at the moment they spawn in the wild so that fish can’t feast on them. Scientists care for them in a lab until they can be planted on the ocean floor in the Caribbean (English).
Quote of the Week
“La sonrisa se ha puesto de pie como una hazaña.”
“The smile has stood up like a feat.”
– Manuel del Cabral (1907-1999), Dominican poet, writer, and diplomat.
We hope you have a productive week. Please send any news, comments, or baby corals’ nurseries to CaribbeanWeekly@energynarrative.com.
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