Domestic Economic Activity

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(Central Bank of Trinidad & Tobago, March 2017)

Energy Sector

The energy sector experienced declining economic activity in the second half of 2016.  Weakness in the energy sector reflected contractions in crude oil, natural gas, LNG and petrochemical production which outweighed increases in petroleum refining.  The Central Bank’s Quarterly Index of Real Economic Activity (See Box 2) which is a weighted average of output changes in selected commodities, suggests that output from the energy sector declined by 14.6 per cent in the latter half of 2016.

Petroleum

The domestic petroleum industry registered a 7.7 per cent year-on-year decline in crude oil production in the second half of 2016. Over this six-month period, lower output was evident from several major producers including Petrotrin, bpTT, BHP Billiton and Repsol. Production levels were adversely affected by increased maintenance activity and declining yields during the period.  Crude oil production averaged 69,952.3 barrels of oil per day (bpd) during July to December 2016, compared with 75,823.5 bpd over the corresponding period in 2015. Similarly, exploration activity experienced significant declines as evidenced by falloffs in both total depth drilled and rig days. Total depth drilled fell by 25.8 per cent while rig days declined by 26.1 per cent.

The Petrotrin refinery continued to reap benefits from upgrades completed in 2015. For the second half of 2016, refinery throughput improved 18.0 per cent year-on-year. Refinery throughput averaged 148,423.7 bpd over the six month period, compared to 125,794 bpd for the same period one year earlier. Refinery activity was supported by a 23.5 per cent increase in crude oil imports.

Natural Gas

Natural gas production fell by 15.4 per cent over the period July to December 2016.  The sharp decline was largely attributable to a drop in production from bpTT. Output from the company fell to less than 1,200 million standard cubic feet per day (mmscf/d) in  August (Table 9) reflecting downtime to facilitate the tie-in of the Juniper field. Juniper is expected to add up to 590 mmscf/d of gas when fully operational.

Production of both LNG and NGLs were affected by the activities of their upstream counterparts. Output from Atlantic LNG fell 16.0 per cent over the second half of 2016 as all four Atlantic Trains produced below capacity over the period, most noticeably Train 3 in August and Train 4 in September. With the large decline in natural gas output, production of natural gas liquids (NGLs) also fell 18.1 per cent (year-on-year) over the six-month period.

Nitrogenous Fertilizers

Fertilizer output declined by 3.2 per cent during the period July to December 2016, as output continued to be affected by disruptions to natural gas supplies. Several facilities underwent maintenance over the period as the petrochemicals sector continued to grapple with issues surrounding the availability of natural gas from upstream producers. The Yara, Tringen I and Tringen II plants were all taken down for various lengths of time during the period.

Methanol

Methanol production declined by 23.1 per cent as the sector faced several shutdowns. Three (3) of the country’s seven (7) methanol plants endured major periods of downtime during July to December 2016 as natural gas feedstock was severely curtailed. The Trinidad and Tobago Methanol Company TTMC I plant was brought online in October 2016 after a 5-month outage while Methanol Holdings Trinidad Limited (MHTL) MIV plant was down during September 2016. The M5000, the largest methanol plant, was down for the month of October 2016. These shutdowns came in addition to shorter outages at other plants during the period under review. Additionally in the month of December, three facilities (TTMC I, TTMC II and the CMC plants) were all shut down.

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