Trinidad’s LNG Output To Drop More On Gas Deficit

(Argus, 8.Dec.2020) — Trinidad and Tobago’s faltering LNG production will decline further in 2021 when 20pc of Atlantic’s liquefaction capacity undergoes an indefinite turnaround because of a natural gas shortage.

Atlantic’s 3mn t/yr Train 1 will not be completely shut down in January, but the turnaround will put it “in an operations-ready mode for all of 2021 into 2022,” energy minister Franklin Khan said on 4 December.

BP, which supplies all the gas for Train 1, said its infill drilling had failed to deliver at forecast levels to ensure supply.

“Train 1 will continue to operate in 2021 and will be part of a wider negotiation among Atlantic’s shareholders to form one unitized facility encompassing all four trains,” Khan said.

“The shareholders have approved the turnaround scheduled in January for the train,” he said, without detailing the schedule.

“We are in some sensitive negotiations … with upstreamers to supply gas to Train 1,” Khan said.

BP and Shell are the top shareholders in the four-train 14.8mn t/yr Atlantic liquefaction plant in southwestern Trinidad. They are also the Caribbean country’s leading gas producers. BP, Shell and Atlantic have not responded to queries about the duration of the turnaround.

Train 1 needs 250mn cf/d of gas to operate efficiently, the energy ministry told Argus yesterday. “The length of the turnaround will be determined by the speed at which the gas can be identified,” it said.

LNG production totaled 19.68mn m³ in January-September 2020, down by 9.6pc from the corresponding 2019 period, according to energy ministry data.

Gas production of 3.21 Bcf/d in January-September fell by 11.2pc on the year.

The different ownership structure of each of Atlantic’s four trains has complicated feedstock allocation since Trinidad’s gas production started to decline a decade ago.

Shell is Atlantic’s majority shareholder with an overall 53pc stake in the complex. BP holds 39.2pc overall while Trinidad’s state-owned gas company NGC has a 10pc interest in Train 1 and 11.11pc in Train 4. China’s sovereign wealth fund CIC unit Summer Soca owns 10pc of Train 1.

The four liquefaction trains will operate as a single unit under a restructuring being negotiated, the government and the shareholders said in February 2020.

The restructuring “will result in the unitization of the Atlantic entities that own the four LNG trains into a single entity with a simplified commercial structure which will enable long-term investments in the upstream and at Atlantic,” they said at the time.

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By Canute James