I read a recent newspaper article which I thought contained unfair criticism of Minister of Energy Franklin Khan. After citing a number of facts, the writer called for the resignation of the minister.
However, it became very apparent that these justifications were shaky at best and the writer omitted a significant amount of other information which would have provided the reader with a wider perspective.
The article hinges its argument on an apparent decline in natural gas and crude oil production which currently stands at 3.2 billion cubic feet per day (bcf p/d), as compared to 3.3 bcf p/d in 2016 when the minister assumed office.
This in itself is a bit misleading because in the last year, due to the effects of covid19 and the collapse of energy demand, the response by energy companies globally has been to reduce production.
The first half of the article clearly showed that 2020 is an anomaly year, which I agree with. However, one cannot then take that to be used as a basis to call for a minister’s removal.
The facts, according to the Central Bank, are that in 2018 and 2019, natural gas production measured 3.6 bcf p/d. That represented an almost 14 per cent increase in production during the minister’s tenure. It is clear, taking out the anomaly of covid19, gas production increased under Khan’s watch.
Oil production had been on a steady decline for years, moving from 102,000 barrels per day (bpd) in 2010 to its current production level of 56,000 bpd. However, the key to increased production lies with the establishment of Heritage, with a focus on oil production, along with its strategic partnerships with other energy players.
The Ministry of Energy estimates that increased production from Heritage, BHP (Ruby/Delaware fields) and Touchtone (Coho-1 and Cascadura fields) should increase oil production by a further 34,000 bpd by 2022. These are real projects on-stream, fostered under the current minister.
Further, the latest Ryder Scott Report is strongly positive for this country. Between 2016 and 2019, proven reserves increased from 9.9 trillion cubic feet (tcf) to 10.7 tcf. This is no easy feat given the higher replacement rate of gas needed to increase reserves.
Additionally, a crude oil audit of the country’s reserves showed a gigantic leap in our prospective oil resources by 773 per cent from 2012 to 2018, which stood at 3.2 billion barrels in 2018. This speaks to the confidence energy players currently place in this country, by continuing to make major investments in exploration and production activities.
Most striking to me was the fact that the article skirts over entirely the successful restructuring of Petrotrin to incorrectly state it was “closed down,” therefore the minister must go. Though the refinery component was removed, the exploration and production and fuel transmission components were retained in the form of Heritage and Paria.
Together, both companies made a profit of over $1 billion in 2019. Compare that to a Petrotrin which was losing over $2 billion per year and was saddled with major debt that burdened taxpayers. Fortune 500 companies can’t even boast of such a turnaround but under this Minister of Energy, this success was achieved.
These are just some of many points I could have elaborated on and why I think the article calling for the removal of the Minister of Energy is baseless and unjustified. On the contrary, I think the minister as well as the entire Government has done a fantastic job in navigating this country out of an energy crisis and placed us on a positive pathway, notwithstanding the covid19 challenges.