Trinidad & Tobago’s (“T&T”) economy is overwhelmingly oriented to the energy sector which constitutes the government’s primary fiscal stream. Given that the sector employs a large number of locals – a decarbonisation programme is a politically sensitive issue if it results in voters losing their jobs as roles become redundant. Indeed, last year Kishan Kumarsingh, head of the multilateral Environmental Agreements Unit at the Ministry of Planning and Development, said the country aims to implement a ‘Just Transition Policy’ to safeguard workers’ rights during the process of shifting to a low-carbon economy.
What does all this mean for investors? The head of a national decarbonisation NGO explained, “The unfortunate thing is that investors here seem not to have to worry about ESG matters at this moment – they are guided more by their corporate offices. What their parent companies globally are doing and what is required here in T&T may be different in all elements of ESG unfortunately.”
“What their parent companies globally are doing and what is required here in T&T may be different in all elements of ESG unfortunately.”
Head of a national decarbonisation NGO
Several companies currently operating in the country contribute significantly to the national carbon footprint. According to our sources, permits are issued by the Environmental Management Authority and these permits are renewed each time they expire without a requirement that they clean up during the time of the permit.
An energy expert in the private sector explained, “The long-term prospects for oil and gas operators here are very poor. If we look at Atlantic LNG for example, which is starving for gas even less than their contracted amounts by at least 20%. There are big downstream operators who don’t have enough gas to keep going. And every time one of them closes hundreds of jobs are lost and there is less revenue for the government. Given that context, ESG concerns are at the bottom of the list.”
“The long-term prospects for oil and gas operators here are very poor. And every time one of them closes hundreds of jobs are lost and there is less revenue for the government. Given that context, ESG concerns are at the bottom of the list.”
Private sector energy expert, the Carribean
What seems to be lacking in T&T in terms of making a carbon transition is the political will to do so. “With five-year political cycles, we don’t have politicians thinking longer than that. It will mean some amount of discomfort among the citizenry who enjoy a lifestyle that is very troubling both in terms of oil and gas, power generation, transportation system and so on. It’s a very, very difficult thing,” added the NGO head.
T&T has made decarbonisation commitments under the Paris agreement. However, the country’s ‘nationally determined contribution’ means that Port of Spain has not subscribed to a 1.5 degree rise or carbon neutrality by 2050.
Things could be slowly improving. In January of this year, BP in T&T announced it was committing USD 340,000 to the country’s first Carbon Capture and Storage mapping project. The project will form the foundation for assessing the feasibility of using carbon capture and storage as a solution to significantly reduce T&T’s carbon emissions. That said, “I don’t think a carbon transition is on the table right now, therefore I don’t think it would impact growth prospects in oil and gas any time soon,” added the energy expert.