Trinidad and Tobago PSC for OMEL likely next month

Vol 12, PW 12 (30 Oct 08) Exploration & Production

Trinidad and Tobago’s parliament is expected to approve a PSC for Lakshmi Mittal and ONGC promoted joint venture ONGC Mittal Energy (OMEL) next month for the 1019-sq km shallow water North Coast Marine Area 2 (NCMA-2) block more than two years after it was offered.

“The delay in signing the PSC is because of the Trinidad government,â€‌ said an industry source. “They are very slow in their work.

â€‌ (Closer to home, we note, the same could be said about Premier and Essar still waiting after more than a decade to sign a PSC for the Ratna and R series discovered oilfields). Exploration block NCMA-2 was offered by the Trinidad government in January 2006 when it invited bids for eight onshore and three shallow water blocks.

In April last year OMEL won the block, beating UK-based Centrica with a $204m work programme of which $30m has already been paid as â€کsignature bonus’ to the government. Details of the work programme have not yet been revealed.

But PETROWATCH learns that in Phase-1, OMEL has committed to acquire 3D seismic for a 986-sq-km area and drill five exploration wells in water depths of 120 meters. “OMEL will have to start drilling within 18 months of signing the PSC,â€‌ we hear.

“They will be mainly prospecting for gas.â€‌ Staffers from ONGC’s offshore arm OVL are already in the country.

“There is an office in Port-of-Spain (the capital) and two geologists are stationed there.â€‌ Two more OVL staffers, one from drilling and one from finance, will join them soon.

OMEL has a 65% stake in the block with the remaining 35% held by Petrotrin, or the Petroleum Company of Trinidad and Tobago. ONGC holds 49.98% in OMEL, while Mittal holds 48.02%; SBI Caps owns the rest.

Many multinational firms already have significant operations in the area, among them British Gas, which has operated in Trinidad since 1989 and has stakes in four LNG liquefaction trains operated by Atlantic LNG.