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[mark10101] 19/2/2019 09:06

Well there we go, TXP bit the bullet with a raise just to get them through the first Ortoire well. Nearly 50% discount to recent high, WOW. Suspect the usual suspects will keep a low profile today or find some pricing metric that makes TXP look better than how the headline figures look and they used crudely against TRIN.

[spellbrook] 16/2/2019 10:36

hxxp://www.cityam.com/273343/oil-prices-end-week-more-than-five-per-cent-up-and-end-2019

Oil prices reached their highest this year after rising more than 2 per cent on Friday in the wake of an increase in expectations on the tightening supply caused by an outage at Saudi Arabia's offshore oilfield.



The progress made between the US and China in talks over their trade war also strengthened the position.

Brent crude oil rose 2.6 per cent to settle at $66.25, a rise of $1.68, marking its highest price since November last year.

US WTI futures crude oil settled up 2.2 per cent, or $1.18, at $55.59 a barrel, hitting its highest this year.

Brent ended the week more then 6 per cent up, while WTI had also gained more than 5 per cent, thanks in part to the tightening supplies following the organisation of the petroleum exporting countries and its allies led by Russia started voluntary production cuts last month.


The world's largest offshore oilfield, Saudi Arabia's Safaniya, was partly closed around two weeks ago and the limit to its daily production of more than one million barrels has seen supply tighten further than expected. It is not clear when the field will return to full capacity.

Leading OPEC producer Saudi Arabia said on Tuesday it would cut an additional half a million barrels per day in March more than it previously pledged.

While the sanctions on Venezuelan and Iranian crude, along with reduced Libyan output due to civil unrest, have further reduced global supply.

Additionally, there has been growing confidence that the US and China will resolve their trade dispute, with talks set to resume in Washington next week.

[nocents] 15/2/2019 21:18

Regarding moneys owed I would like to say that one of BOD used to work for Inland Revenue and Bruce D is a national who grew up next to the refinery. In no way will they let themselves be taken for ride. I am the greatest mistrustor of politicians but BD is canny.
MM ..will miss your posts.

[nocents] 15/2/2019 21:12

WTI will see us right. In the end. Demand will oitstrip supply which is being carefullyvrebalanced.
T and T politicians are genuinely inept but Trin are not. Rabbits still sit in hats. I aim to buy more next week if funds end up being released.

[mark10101] 15/2/2019 16:58

No one knows anything. If you have been reading the reports posted recently the industry is very frustrated with the T&T government, certainly while we are in the SPT dead zone, as we are now and have been for months. TXP have openly stated the number of wells they will drill will be dependant on SPT reform. TRIN are yet to announce this years drill schedule, I suspect waiting for the fiscal landscape/oil price to evolve.

So I suspect some investors are feeling the frustration the industry is, I know I am given reform has been promised on multiple deadlines. However As Paul Baay said in the upstream article I posted earlier in the week, Heritage have a lot of production offshore, with 33% SPT being paid as I type they do not stand a chance if they are to pay this tax, rather than accrue it as they did in Petrotrin. It has to be reformed otherwise the government have just created a loss making entity that will look politically bad at elections next year.

[marvelman] 15/2/2019 16:47

I sold just after the last update. When I read that the company is now waiting to get paid "sometime during 2019" a huge amount of cash from Petrotrin ($5 million for godsake). Neither Petrotrin nor the T & T government do I trust. It seems unreal that a company such as Petrotrin cannot pay its dues to its creditors but can pay its former employees on time. I wonder how many other companies in T & T are in the same position. TRIN is in the fortunate position that it can live off its bank balance...but how many companies in T & T can make that claim.When we get an update telling us we have been paid I will look again but to be honest I am at the end of my tether with T & T oilers and T & T the government. My sincere best wishes to all still invested.

[princebuster2] 15/2/2019 15:45

Surely whom ever is selling has to be selling at a loss??? And if so they gotta be spooked about something!?!

[spellbrook] 15/2/2019 15:23

our 33,000 and 36,000 seller not giving up ?????????

[nocents] 14/2/2019 14:54

Now Trin takes ahit.sellers

[sleveen] 14/2/2019 13:56

But TRIN do have offshore production.

[nocents] 14/2/2019 12:44

Interesting. All T and T’ers except Trin are markedly down.

[marvelman] 14/2/2019 12:43

….of course the same applies to TRIN but they do not have debt to service.

[mark10101] 14/2/2019 07:23

Interesting the TXP cheerleaders are ignoring that article where PB clearly lays out the impact at this level of oil for TXP, more than halving their free cash flow. Also interesting he has trained his followers to talk about the Brent price but all of a sudden WTI is the price he is referring to in this article and which is of importance....

[spellbrook] 14/2/2019 07:05

Trinidad & Tobago players pushing for tax reforms
February 13, 2019
by Upstream
67
Article originally published by Upstream Online on February 11th, 2019 by Kathrine Schmidt

Trinidad & Tobago players pushing for tax reforms:
Companies call for government to change levy on oil output to help to boost competition

Oil players in Trinidad & Tobago are urging changes to the government’s supplemental petroleum tax on oil production, which they say in its current form discourages investment and inhibits oil exploration.

Multiple attendees at the Trinidad & Tobago Energy Conference last week expressed concern about the issue and specifically in regard to Heritage Petroleum, which late last year was spun out to handle the upstream assets of previous state oil company Petrotrin.

“What is of undoubted importance to Trinidad & Tobago is making a success of the new upstream-focused Heritage Petroleum,” said Eugene Tiah, chairman of Trinidad & Tobago’s Energy Chamber and executive chairman of Massy Group's Energy & Industrial Gases division.

"Without the right institutional structures and policy environment it is going to be difficult to attract the necessary private capital that will be crucial to the success of Heritage and the oil sector more widely.

“One of the key inhibiting factors is the current structure of supplemental petroleum taxation, which severely inhibits competitiveness of the Trinidad oil sector.”

Under the current fiscal regime, Supplemental Petroleum Tax (SPT) kicks in when oil prices hit $50.

When introduced it was aimed at placing a higher government take on then-thriving oil production, with lower rates on gas designed to act as an incentive to help boost activity.

The scenario has now reversed. Gas output is rising, rebounding to 3.6 billion cubic feet per day in 2018 and expected to climb to 3.9 Bcfd in 2019 and stabilise at around 4 Bcfd over the 2020 to 2023 period.

By contrast, oil output has fallen to a multi-year low of about 66,000 bpd.

Part of the problem lies in what happens when oil prices hover between US$50 and US$60 — territory where the commodity has spent a lot of time recently.

"Oil companies in Trinidad & Tobago are in a negative cash flow situation when prices are in the low (US$50s), only returning to positive cash flows when prices are in the (US$60) region," the chamber wrote in an op-ed that ran in T&T's Guardian late last year.

"Because companies are running scenarios on (US$50) oil before making investment decisions, addressing the issue of how SPT is calculated and payable, is crucial to attracting investment into the traditional oil sector."

Neither Prime Minister Keith Rowley nor Energy Minister Franklin Khan explicitly mentioned SPT but Rowley did express willingness to work together on improving output.

“We need to expand the level of collaboration to maximise the level of hydrocarbon output,” he said.

Paul Baay, chief executive at T&T-focused independent Touchstone Exploration, said that while tax incentives had been successful in encouraging gas production, the oil sector was having a harder time with fewer wells being drilled and output down.

“One of the benefits that we have this year is Heritage, now broken out from Petrotrin, is actually going to have to pay that tax as opposed to just accrue it,” he explained.

“I think we have a much better ally now with Heritage on this particular issue. It’s going to give us an opportunity.”

He explained how the SPT plays out from the point of view of his company, which works to revitalise onshore fields. Last year, he said, the company had some US$11 million in cash flow.

“We make almost that same amount again with oil roughly at US$47.60. The minute you cross over to US$50 and the SPT kicks in, our actual cash flow drops to US$5 million. It actually gets cut more than in half.”

As an onshore producer, Baay sees his company as “lucky” because his company pays out some 18% in taxes.

That take rises as high as 33% when it comes to offshore operations.

“When you look at a company like Heritage that’s going to have to grow that offshore production, if they have a burden of a 30% SPT tax they really just don’t stand a chance,” Baay continued.

“Whether it’s an increase in deductibility or changing of the tax, something’s got to give at some point if we want to meet that objective of growing production.”

Kevin Ramnarine, who served as Trinidad & Tobago's energy minister from 2011 to 2015, has also been outspoken on the SPT issue.

His administration offered its own incentives to grow production, measures he acknowledges confronted their share of criticism.

“If we reduce taxation, we get a big positive effect in more activity... which means you grow the pie, so in the end the government gets more tax because you have a larger pie,” he told Upstream on the sidelines of the conference.

However, in other areas, the government has shown signs of tightening up the fiscal regime.

The government has been trying to make up ground after the drastic decline in commodity prices earlier this decade hurt the country’s economy significantly.

Revenues from petroleum fell 90% from over TT$19 billion (US$2.8 billion) in 2014 to less than TT$2 billion in 2016, Upstream previously reported.

In two examples, the government has both pushed for re-negotiation with majors for contracts in Atlantic LNG, as well as employing a 12.5% royalty in model production-sharing contracts to be used in the country’s upcoming shallow-water bid round.

The decision to implement the royalty is in keeping with the government’s “philosophy that the state must be assured a steady stream of revenue,” Khan said.

The process has so far attracted "strong interest by the major upstream companies".

Ramnarine, however, expressed concern that those terms may be “very difficult” for companies, with the process potentially struggling to attract new players other than those already working in the country.

“I think that attractiveness of investment is under threat and I think that’s something all governments have to constantly be fine-tuning,” he said.

“Because capital is not obligated to come to any country.”

[nocents] 13/2/2019 20:38

SP. Can’t see whole article. Can u cut ‘n paste it?
Rowley will need something to happen I’m sure. But politicians tend to have greasy fingers. Let’s hope he doesn’t grease our palm and take away with the other.
Trin will do ok with or without .
No better time to buy in though. Think what’ll happen to share price if he does actually do somet’in!!
Come on...no more hot air....action Messrs Imbert/Rowley/Khan.
Done enough talking....great history lesson of T and T last week but we live in the here and now. Wi
Action not promises

[spellbrook] 13/2/2019 20:24

Rowley suggesting revamp of production

SPT reform to follow. ????

[nocents] 13/2/2019 18:16

Well said Mr.Baay.
Come on Messers. Imbert and Khan...get off the gga and look at your gdp.
Pull-fingers-out time. Trin and Tob produces heavy oil..in demand npw Venezuela struggling to produce and sell. Shale is light/sweet. If T and T don’t reform this tax they are deaf to all those around them.Good for Baay to speak out. Why have Trin not done this publicly too?? Shame on them. And they pay far more!

[spellbrook] 13/2/2019 18:01

Read about 'Trinidad & Tobago players pushing for tax reforms' in @UpstreamOnline & @TouchstoneExp CEO Paul Baay “One of the benefits that we have this year is Heritage, now broken out from Petrotrin, is actually going to have to pay that tax as opposed to just accrue it,” #TXP

[mark10101] 13/2/2019 13:55

Quite right

[nocents] 12/2/2019 17:05

These were the figures promised for Jan 12th. Beemn waiting for them. It means they are serious about rebalancing oil price and their own kudos. Let’s now await APAi/EIA if they are to be believed of course. And rig count. Low fifties hurt shale and cold weather draws on inventories.