New Fortress Invests $400 Mln in Pilot Project

(Jamaica Observer, 15.Jul.2018) – New Fortress Energy announced on Friday a new partnership with Jamaica Urban Transit Company (JUTC) for the introduction of the first natural gas-powered buses in Jamaica, which will significantly reduce emissions, pollution, maintenance and fuel costs.

As part of the partnership with the Government of Jamaica, New Fortress Energy will fund the pilot project for the conversion of five buses operated by JUTC to run on clean-burning liquefied natural gas (LNG) by early 2019.

The pilot programme, which consists of five new LNG-powered buses and a fuelling station in Kingston, is estimated to cost close to $400 million.

The new buses will reduce emissions and pollution and are expected to operate more efficiently, furthering the Government’s efforts to achieve energy diversification for sustainable economic growth and better protect the environment.

“We’re delighted to partner with the Government of Jamaica to introduce clean, reliable and affordable natural gas to the public transportation sector,” said Wes Edens, founder and chairman of New Fortress Energy.

“This partnership will be a catalyst for the transportation industry to reduce harmful emissions and pollution by using cleaner fuels. Jamaica continues to set an example with transformative energy investments that help grow the economy and protect the environment.”

Meanwhile, Minister of Transport and Mining Bobby Montague said, “We look forward to the conclusion of this pilot, using LNG-powered buses. We are very encouraged and excited about this groundbreaking initiative that will greatly enhance our environment. The Government is committed to support, create and enable the implementation of this pilot project. We anxiously await the results, so that a proper technical review can be done and chart a new pathway.”

He further noted that New Fortress Energy is funding five new buses so that the results of the pilot programme are not skewed by other factors.

The buses will be deployed across the system, and the ministry, along with JUTC stakeholders will be looking at the results to assess the success and viability.

In agreeing with the Minister, Paul Abrahams, managing director for JUTC, said; “This is indeed a significant milestone for our transport system and importantly, for our environment. We are very excited about it and look forward to the results post-pilot.”

Known as one of the safest, non-polluting and non-toxic fuels, LNG is an odorless fuel that offers significant energy efficiencies and emission reductions over alternative fossil fuel sources. It is cooled to a liquid form at -260°F and stored at atmospheric pressure, making it safe to handle and transport across the world.

The introduction of LNG as a clean and safe alternative fuel source in Jamaica is expected to lower energy costs and reduce environmental impact.


FDI in LAC Region Falls for Third Straight Year

(Energy Analytics Institute, Ian Silverman, 12.Jul.2018) – Foreign Direct Investment (FDI) in Latin America and the Caribbean fell for a third straight year in 2017, reported the Economic Commission for Latin America and the Caribbean or CEPAL by its Spanish acronym.

The details were revealed in CEPAL’s annual report titled “FDI in Latin America and the Caribbean 2018.”


PetroCaribe Fund to Flow into Government Coffers

(Jamaica Gleaner, 11.Jul.2018) – In a matter of months, the US$1.6 billion, or more than J$208 billion, now in the PetroCaribe Development Fund (PDF) is to flow to the Consolidated Fund and could be administered as the Minister of Finance sees fit.

The transition is expected to happen by the end of the fiscal year, or by the time PDF Chief Executive Officer Dr Wesley Hughes leaves, that office when his contract expires next February.

Hughes told the Financial Gleaner that since about February this year, the finance ministry has had “preliminary discussions” with the PDF about the planned change in the structure of the fund that at its zenith managed more than US$3 billion in assets.

The talks, he said, mulled what form “integration” could take but arrived at no definitive conclusion. The PDF CEO pointed to the finance ministry as the source for any further questions about precisely how the fund, set up in law to service Jamaica’s debt to Venezuela and provide development funding, would operate as part of the Government’s central operations.

The finance ministry is yet to comment. Finance Minister Nigel Clarke is currently overseas engaging financial markets in a non-deal roadshow.

The PDF gets broad policy directions from the finance minister, but is largely an independent and self-financing entity, whose profits not only serviced Jamaica’s oil debt to Venezuela, but invested, mainly via loans, in development projects. It has pumped more than $335 billion into the economy through project financing, equity investments, and social and economic development grants.

“The expectation is that the fund will become more integrated in the Ministry of Finance. It will continue to operate the elements of managing the loans that are in place and long-term debt repayment commitments to Venezuela,” Hughes said. He, however, declined to speculate on the model by which these aims might be achieved.

In the April 2018 Article IV Consultation report on Jamaica, the International Monetary Fund (IMF) listed the integration of the PDF into Government’s central operations as an outstanding item still to be undertaken by the Jamaican Government.

The IMF report gave a March 2019 date for the completion of the action, which, it said, was an undertaking by the Government dating back to the second standby agreement review in September 2017. Hughes said there was no discussion of this commitment with the PDF at that time.

The change in status of the PDF from a public body corporate to being administered as part of central government is part of a raft of policy measures mandated under the current IMF agreement. The measures include the merger of several government organisations, divestment of some public bodies, and stepped-up initiatives to reduce the size of the public sector and wage bill.

The end of the PDF, as it was established by law under a 2006 amendment to the Petroleum Act, is expected to require legislation in Parliament and, possibly, concurrence from Venezuela, given that the PetroCaribe agreement for the concessionary import of oil remains in force, despite the scaling down of shipments and Jamaica’s massive reduction of its oil debt to Caracas. That debt is now at around US$120 million following the cash repayment of some US$1.5 billion three years ago, in a hugely discounted debt buy-back.

Hughes said closure of the fund was viewed as a possible strategic risk by its management in annual planning and financial projections.

As former chairman of the fund when he served as financial secretary in the finance ministry between 2009 and 2012, Hughes said the PDF was deliberately structured to complement the IMF staff monitoring arrangement that was in force in 2006, as well as to safeguard its mandate as political administrations change.

The insulation measures include the financial secretary’s chairmanship of the board and ex-officio membership on the board, accorded to senior public sector officials, including the Cabinet secretary, the head of the Planning Institute of Jamaica, and permanent secretaries of several ministries, such as the Office of the Prime Minister and the ministry with responsibility for energy. About three members are appointed by the finance minister.

Hughes considers the structure, including its direct reporting to Parliament, as adhering to global best practice.

“It’s not that we are not subject to political directives (but) for the most part these directives have been consistent with the Constitution, rules and regulations. After all, we are a public body; we are subject to Cabinet decisions,” he said.

“Cabinet is the highest decision-making body in the country. If they take a decision, our job is not to question it, but to find out how best and effective we can be in implementing that decision. If you don’t have that approach, anarchy is the outcome,” he added.

He also believes that the structure “has worked”, saying “we have found ourselves with sufficient room to do what we have to do to fulfil our mandates”.


Cabinet Removes Energy Portfolio Over Petrojam

(Jamaica Gleaner, 2.Jul.2018) – Dr Andrew Wheatley has been stripped of the energy portfolio as the government implements a raft of changes at the controversy-plagued oil refinery Petrojam.

A statement a short while ago from the Cabinet indicates that the portfolio has been shifted to the Office of the Prime Minister.

It says the move is in the interest of transparency in light of ongoing investigations.

Petrojam is currently under investigation by at least four oversight state entities, which are probing claims of corruption, fraud and mismanagement.

The oil refinery’s parent ministry is the Ministry of Science, Energy and Technology.

With the shift in portfolio responsibility, Wheatley retains ministerial control of science and technology.

There have been calls for Wheatley to resign or be fired by the prime minister over the handling of the affairs of petrojam but those calls have been ignored.


Cabinet today continued its consideration of a report it received last week on Petrojam and, having regard to investigations already underway, decided the following:

  1. The residential status of all persons nominated to boards must be stated in the Cabinet Submission seeking approval for appointment.
  2. Overseas travel of Board Chairmen or Board members must receive prior approval of the Minister.
  3. Public bodies will be prohibited from entering into sole source retainer contracts without the prior approval of Cabinet.
  4. The Ministry of Finance has been tasked to develop and finalise uniformed regulations for public bodies around donations and corporate social responsibility. Among other things, this would see limits on the amount that can be approved at the agency level. It will be a requirement that all donations be disclosed with details to include the amount, the receiving entity, the purpose of the donation and connected party consideration with the management, board of directors or the Minister.
  5. After discussion with Minister Wheatley, it was agreed that Petrojam requires strategic review of both of its management and operations, as well as its long-term commercial viability and role in Jamaica’s energy security.  Having regard to this and the ongoing investigation, Minister Wheatley agreed with the Prime Minister that in the interest of transparency, the energy portfolio will be transferred to the Office of the Prime Minister, effective July 4, 2018.
  6. A special enterprise team will be assembled to conduct and oversee the organisational and strategic review of Petrojam.


Petrojam Partner Knocks Contract Process

(Jamaica Gleaner, 27.Jun.2018) – Petrojam, the beleaguered government-controlled oil refinery, spent over $14 billion or 74 per cent of its domestic expenditure over a two-year period to last October via direct and emergency sourcing, rather than competitive bidding contracts, an internal audit by Jamaica’s partner in the refinery revealed.

The audit report, a copy of which was obtained by the Financial Gleaner, was completed in February and forwarded by PDVSA’s internal audit corporate manager Juan Rodriguez to Petrojam chairman Percival Percival Bahado-Singh, who, with the two other Jamaican directors, were forced to resign last week in the face of deepening allegations of widespread corruption at the refinery.

PDVSA, the state-owned Venezuelan oil company, owns 49 per cent of Petrojam.

While its report concluded that most of these direct-source contracts may have been necessary to solve urgent operational and other problems, the auditors complained that “there were items that could have been awarded under a competitive method” – an observation that is likely embolden critics of the refinery’s management in the belief that the excessive use of sole-source contracts opens the way to corruption.

These concerns will be further exacerbated by the report’s tone, which suggests less-than-robust record-keeping and data analysis that made audit verification, in many instances, difficult.

Petrojam’s parent, the Petroleum Corporation of Jamaica, redirected requests for comment on the report to Petrojam, but the refinery’s boss did not respond.

Phillip Paulwell, the shadow energy minister, said he was aware of the report and its contents, but was still studying it before arriving at firm conclusions.

“It does have some glaring matters of concern,” he told the Financial Gleaner. “I am taking my time to ensure that I understand all the issues and their implications,” he said.

With regard to the direct sourcing contracts, the Jamaican Government’s procurement rules allow for these up to a maximum of $1.5 million – it used to be $500,000 up to 2016 – except in circumstances such as emergencies, the goods or services are available only from a single contractor, or for national interest considerations.

Over the period covered by the audit, from January 2015 to October 2017, Petrojam awarded 3,583 contracts, of which 2,263, or 63 per cent, were via direct awards – although 325 of these, or 14 per cent, were to its subsidiary, Petrojam Ethanol Limited. Twenty-five per cent of the direct sourcing contracts exceeded the threshold for such award and six per cent of the contracts were deemed to have been triggered by emergencies.

The audit tests of 14 awarded by direct sourcing found that nine presented reasonable justification, while in five cases, the auditors found no “written justification”. Those cases, however, related to the repair and cleaning storage tanks, and all were approved by the general manager.

The auditors, concerned that competitive bidding accounted for only 25 per cent of Petrojam’s domestic contracts, called for an improvement in the “utilisation rate of the limited bidding and competitive bidding methodologies”.


The spot purchase of oil was an area in where the auditors could not always ascertain that Petrojam received the volumes for which it paid. Part of the problem has to do with the less-than-optimal functionality of the refinery’s storage tanks and other systems to ensure an absolute correlation between the returns in processed products and the expectations from the declared volumes of crude, based on simulations.

But it also appears that records of spot purchases, such as from the commodities trader, Vitol, were rigorously maintained to ensure that price calculations supported purchase invoices.

For instance, PDVSA auditors noted that the list of purchases of crude and finished products, which they were provided by designated officials, didn’t come from the Systems Application and Products, or SAP systems management software, which is widely used in the oil industry.

Further, they said: “Seventeen of 23 invoices (74 per cent) did not have the verification of the price calculation in the support of the purchase invoices the validation of the reasonableness of the amounts invoiced …”.

In other case, five of nine deliveries, purchased on the condition of delivery at terminal, or DAT, indicated gross volume rather than net volume at the discharge port, “increasing the risk of inconsistencies between the volume record in SAP” and the refinery stats on which monthly losses at the refinery are estimated.

Additionally, two of the 23 reviewed purchases showed volume difference of over 139,000 barrels “between the figures indicated on the commercial invoices provided by the customer (Vitol) and reflected in the independent inspector’s discharge reports”.

There were also significant differences on the price per barrel of oil, the auditors noted, “between the invoices reported in SAP by the accounting department”.


Jamaica Saves $230m Under Energy Efficiency

(JIS, 14.Jun.2018) – The Government has saved $230 million, to date, and reduced environmental emissions from the implementation of major programmes in energy efficiency, conservation and management.

The Petroleum Corporation of Jamaica (PCJ)-implemented initiatives are the Deployment of Renewable Energy and Energy Efficiency in the Public Sector Project, launched in 2016, to provide renewable energy and energy-efficiency systems in six hospitals; and the Energy Efficiency and Conservation Programme (EECP) to retrofit several government entities and facilitate training in best practices for energy efficiency and conservation.

The EECP has given way to the US$40-million Energy Management and Efficiency Programme (EMEP) officially launched on March 30 and is intended to improve energy efficiency in the public sector, through retrofits at government facilities, and enhance urban traffic management in order to shorten travel times. It will also strengthen the technical capabilities of the Ministry of Science, Energy and Technology to enhance energy planning.

Portfolio Minister, Dr Andrew Wheatley, said that together, these programmes have enabled the country to “cut down expenditure and high electricity bills within the public sector”.

“We are environmentally conscious people as well, so we (have) also reduced our carbon footprints. To date, we have cut our carbon dioxide emissions by 3,000 tonnes, and that is important. We have also reduced our demand for fossil fuels, reducing oil importation by some 2,293 barrels,” he noted further.

He was speaking at the launch of the PCJ/Government of Jamaica, Energy Champion Competition at The Jamaica Pegasus hotel in New Kingston on June 13.

Turning to the renewable energy programme, Wheatley explained that having already moved the original target of obtaining electricity from these sources from 20 to 30 per cent by the year 2030, the Government is contemplating raising the target even further.

“The reason for this is that we have been implementing renewables at a rapid pace. Currently, we are somewhere between 17 and 18 per cent of electricity coming from renewable sources,” he noted, adding that the Government is seeking to “aggressively go to the market to get more renewables on to the grid”.

“The Electricity Act and the licence given to the Jamaica Public Service (JPS) in January of 2016, speak to us making the necessary provisions to accommodate more renewables,” he pointed out.

Meanwhile, Manager of Corporate Affairs and Communications at the PCJ, Camille Taylor, explained that the aim of the Energy Champion Competition is to have every single member of the public sector and the wider public engaged in conserving energy.

“We want to see great savings across the public sector. We want to see great savings across households and businesses, and that is what the competition is all about,” she said.

A total of $20 million in prizes is up for grabs in the competition, which is an initiative of the PCJ under the EECP.

The competition includes categories for government agencies, schools financed by the Consolidated Fund, and individual citizens. Organisations can win a five-kilowatt or 10-kilowatt solar photovoltaic system valued at up to $5 million or a runner-up prize of up to $1.5 million in energy efficiency and conservation goods and appliances.

Entry requirements include a dedicated JPS meter at the participating entities’ location and the formation of an energy management committee, which will develop and implement an energy-efficiency and conservation plan.

Participating entities must demonstrate a reduction in energy use over a three-month period between October and December 2018 when compared to the corresponding period in the previous year.

During the 2017 staging of the competition, the National Works Agency (NWA) was crowned Energy Champions while eGov Jamaica Limited and the Ministry of Finance and the Public Service placed second and third, respectively, in the organisational component of the competition.

On the individual side, there were 17 winners of prizes that included smartwatches, mini smart switches, energy bulbs/LED desk lamps and tablets.

Jamaican Gas Prices Down by $0.21 per Litre

(Jamaica Gleaner, 13.Jun.2018) – Gas prices are to go down by $0.21 effective Thursday, June 14.

The state-owned oil refinery, Petrojam, says E-10 87 will sell for $132.12 per litre and a litre of E-10 90 will sell for $143.95.
Automotive diesel oil will down by $0.16 per litre to sell for $130.15.

The price of Kerosene is to go up by $0.18 with that fuel to sell for $112.92.

In the meantime, propane cooking gas will go down by $0.20 to sell for $48.29, while butane will go up by $1.27 to sell for $53.13 per litre.

Retailers will add their mark-ups to the announced prices.

Petrojam Responds to Corruption Claims

(The Jamaica Observer, 9.Jun.2018) – Government sources told the Jamaica Observer they are awaiting a response from Venezuela on its offer to repurchase their 49 per cent share in the local oil refinery, Petrojam.

It is understood that during a visit to Jamaica in May, a team from the State-owned Petroleos de Venezuela (PDVSA) met with technical experts from the Ministry of Science, Energy and Technology and Petrojam to discuss the issue.

The meeting ended with an understanding that the Venezuelans would discuss the local proposals on their return to Caracas, and inform the Jamaican ministry on their decision.

The Jamaican Government, which owns the other 51 per cent of the refinery, has been seeking to take full control of Petrojam following the issue of an executive rrder by US President Donald Trump last year, which imposes sanctions targeting Venezuela and its State-owned entities.

Portfolio Minister Dr Wheatley said that since the announcement of the executive order, “the relationship between Petrojam Limited and PDVSA has come under intense scrutiny, both locally and internationally”.

In the meantime, the board of Petrojam, which is comprised of three Jamaican and three Venezuelan directors, has issued a release noting their concerns about issues circulating about the level of integrity and professionalism governing the affairs of the refinery.

“As Jamaica’s sole oil refinery, the company supplies a full range of domestic, transportation and industrial petroleum products to our valued customers.

“As a statutory body and governed, under a Joint Venture Agreement, the company acts with responsibility and transparency, while exercising due diligence in its affairs,” the release said.

According to the release, “At all times the requisite approvals and review channels are utilised for every aspect of the company’s business, including the award of contracts, the provision of donations and the implementation of projects.

“Donations are made to entities, as part of our corporate social responsibility and in an effort to contribute to national development,” it said.

The release said the company is frequently audited by shareholders and routinely audited by reputable firms and the auditor general to ensure that procedures are understood, respected and followed.

“Much has been made about staff compensation at Petrojam. The record will show that the requisite salary ranges as approved by the Ministry of Finance in determining the appropriate remuneration for the recruitment of talent has been maintained.

“Petrojam continues to serve the energy needs of Jamaica, towards economic growth and sustainable development. As Jamaica’s sole oil refinery, the company supplies a full range of domestic, transportation and industrial petroleum products to our valued customers,” the release said.

Ramnarine Talks About Southern Caribbean Deepwater Industry

(Energy Analytics Institute, Ian Silverman, 31.May.2018) – Former Trinidad and Tobago Energy Minister Kevin Ramnarine will speak in Port of Spain about the regional deepwater industry in the Southern Caribbean.

An abstract from his technical talk about the regional deepwater industry in the Southern Caribbean, and the case of Guyana, Suriname & Trinidad and Tobago, follows:

“The 2015 discovery by ExxonMobil of oil in Guyana’s Stabroek Block, the discovery of natural gas by BHP Billiton in Trinidad and Tobago’s Block TTDAA 5 in 2017 and ongoing exploration in both countries and in Suriname have set the stage for a major deepwater oil industry in the Southern Caribbean which could potentially extend to Barbados. Such an industry will have a transformative effect on the practice of geoscience and all aspects of petroleum engineering. In addition, deepwater oil and natural gas commercialization require different skills and technologies different to what obtains on the shallow and average depth waters of continental shelf.”

For more details contact The Geological Society of Trinidad & Tobago at

Energy, Education, and Learning Through NRG ED

(Energy Analytics Institute, Aaron Simonsky, 24.May.2018) – Energy Analytics Institute, formerly LatinPetroleum Inc., continues to promote its “Energy Education Initiative” in the Americas, also known as “NRG ED.”

NRG ED is structured to work with K-12 schools, community colleges, four-year colleges and universities, workforce training programs, communities and businesses, and aims to promote reduction of non-renewable energy usage in favor of renewable energies. However, the core of the initiative is education, without which the NRG ED initiative would not be.

“At its core the initiative is really focused on education,” said Chad Archey, Editor-in-Chief at Energy Analytics Institute from Atlanta, Georgia.

EAI views basic education as most important in the overall learning process and also promotes educational initiatives and research from grade school to the professional level related to the energy sector. EAI aims to foment constructive dialogue regarding energy usage as well as ways to reduce the carbon footprint left by non-renewable energy resources through the following: 1) educational consultancy, 2) development and distribution of educational and training materials, and 3) promotion of debate and discussion regarding renewable energy alternatives.

Energy Analytics Institute (EAI), formerly LatinPetroleum Inc. (dba, is a Houston-based independent company focused on producing non-biased news, updates and special reports for investors interested in the Latin America and Caribbean petroleum sectors.

ECLAC Ssays Venezuela’s Economic Activity to Fall 8.5% in 2018

(Energy Analytics Institute, Aaron Simonsky, 1.May.2018) – The United Nations Economic Commission for Latin America and the Caribbean, also known as ECLAC or CEPAL by its Spanish acronym, projects economic activity in troubled Venezuela will contract 8.5% in 2018.

Gross domestic product or (GDP) estimates for other important countries and regions follows:


Country/Region —————————- GDP (Est.)

Argentina ———————————— 2.5%
Bolivia ————————————— 4.0%
Brazil —————————————- 2.2%
Chile —————————————– 3.3%
Colombia ———————————— 2.6%
Ecuador ————————————– 2.0%
Paraguay ————————————- 4.0%
Uruguay ————————————– 3.0%
Venezuela ———————————– (8.5%)

Latin America and Caribbean (LAC) —- 2.2%
South America —————————— 2.0%
Central America and Mexico ————- 2.6%
Central America —————————- 3.6%
Latin America ——————————- 2.2%
Caribbean ———————————— 1.4%

Source: ECLAC, April 2018

Jamaica, Venezuelan Officials Discuss Bilateral Issues

(Energy Analytics Institute, Piero Stewart, 22.Mar.2018) – Jamaica’s Foreign Minister Kamina Johnson-Smith and her Venezuelan counterpart Jorge Arreaza held a high-level bilateral meeting in Caracas regarding ways to strengthen energy cooperation through the Petrocaribe Energy Cooperation Agreement, reported PDVSA in an official statement. Both officials also reaffirmed their country’s willingness to continue working together for the benefit of their citizens.

New Fortress Energy to Invest $1 Bln in Jamaica

(New Fortress Energy, 5.Dec.2017) – Having committed to investing some US$1 billion (J$126 billion) in Jamaica over the next several years, United States-based company, New Fortress Energy (NFE) is well on its way to doing so.

On Friday NFE and Jamalco broke ground for the construction of a 94 megawatt US$265 million (J$33.3 billion) liquefied natural gas-fueled combined heat and power plant at Jamalco’s Halse Hall headquarters in Clarendon.

This marks NFE’s first foray into the bauxite sector. The project is scheduled for completion in December 2019 at which time the plant will be connected to the national grid. More than 400 jobs will be created during the construction phase.

Speaking at Friday’s groundbreaking ceremony, Chairman of NFE, Wes Edens noted the strides made by Jamaica in its efforts at energy diversification.

“Two years ago virtually a hundred [per cent] of the energy in Jamaica was generated by oil, and two years from now virtually a hundred per cent of it will be natural gas or renewables… The country has been upgraded [in] its credit rating by Moody’s, citing specifically the energy footprint. Energy costs [are] 30 per cent lower and the environment is much cleaner, so with this I think Jamaica is a model not only for the Caribbean but throughout the world. It’s remarkable what has been accomplished here,” Edens said. He lauded the Office of Utilities Regulation, noting “this has been by far the best regulatory environment that I have dealt with.”

Prime Minister Andrew Holness commended NFE for showing faith in Jamaica despite the risks. He said the US$1 billion investment was significant. Holness noted that several major projects are either underway or in the pipeline, including in tourism, IT and BPO sectors and road infrastructure.

Holness said the country must move to reduce bureaucracy to fully benefit from these projects.

For his part, the Opposition Leader, Dr. Peter Phillips, who also spoke at the groundbreaking ceremony, noted the part played by the previous People’s National Party administration in getting natural gas to Jamaica. He stressed that the ground breaking ceremony signalled the introduction of natural gas as the source of energy for Jamaica’s bauxite sector.

Phillips lamented that “despite the reduction in costs, Jamaica’s electricity charges are still too high if we are to become a competitive global manufacturing platform.

To this end he said there was need to pursue our options with renewables, particularly wind and solar.