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THE GAS RUSH: PLAN BUT NO POLICY by Cathal Healysingh

posted 24 Jul 2017, 07:54 by Gerry Kangalee   [ updated 24 Jul 2017, 08:15 ]

Cathal Healysingh is a Civil and Environmental Engineer by training with twenty-four years of experience combining technical, socio-economic and environmental aspects of development in management.

He has worked with donor and other multilateral organisations, national governments, private sector, local elected village councils, and community based organizations, including indigenous peoples, in all thirteen members of Caricom.

What happens when a government has a plan but no policy? Answer: It runs into the proverbial wall at top speed.

A plan is a schedule of activities, resources and a budget to achieve an objective. A policy is a set of principles and guidelines which establish why and how an intended action ought to take place. We see readily that a Policy must precede a Plan. This is especially so when managing natural resources. Let us look at energy resources for example.

The T&T government has been in the business of oil/gas exploitation for over 100 years (oil) and about 30 years (gas). Yet, the Government does not have an energy policy. It does have a Master "Plan" for gas. The reason why there is no energy policy is because it was never ever questioned that we were going to do anything else but rush the gas. Hence the "Gas Rush" became the unwritten de facto Energy Policy.

Now this “Gas Rush” is happening because the Government has an "Industrialization Policy" which can be summed up as an open door invitation to "the bigger the better", with no controls, no regulations. A free for all from which we collect rent, revenues largely through taxes. The consequence of never having an Energy
olicy is that the long-time plan of 100 years, 50 years, 20 years and 10 years ago remains the same today - monetize all one time.

But the world has changed and our national gas tank is reading close to empty. In 2012 Robert Riley declared when leaving the country "the era of cheap gas is over". No one blinked. Why would we? God is a Trini and oil and gas are infinite. Right? Both the red party and the yellow party are fundamentalists in the belief that God is a Trini because neither has ever wondered what would happen the day the tank empties. As karma would have it, the red party is likely to be batting when this happens.

Today, as I write, consultants engaged by the Environmental Management Authority are finalizing a revision of the 2005 National Environmental Policy (NEP). The 2005 Policy contains an Energy Clause which requires a cost benefit analysis (of social-economic-environmental impacts) to be carried out when committing large amounts of finite energy (oil + gas) to a particular use - like LNG, methanol, ammonia, desalination, or just about any use that requires large and continuous volumes of oil/gas. The consultants presented a draft of the revised NEP to the Public in POS recently, which I attended. Guess what? They had removed the Energy Clause.

Also interesting is that the Energy Clause has never been invoked. Ever! This means that the last 40 years of heavy gas based industrialization took place without us knowing the full costs and benefits to the country. "Hmmm," you might say. If that is so, would we not want to retain the Energy Clause in the new NEP? Of course: because what is left of the oil/gas in the ground is deeper, much deeper and more expensive and carries a higher risk in getting it out of the ground. Also, what is left is worth more than what has already been extracted, minus the paltry sums in the Heritage & Stabilization and Green Funds, although it is rumoured that both Funds have been leveraged.

The Energy Clause is essential to the future of this country especially the children. I made this point at the consultation. Yet, I bet that the Energy Clause is removed in the final version of what will be the 2018 NEP. I make this bet with a heavy heart but I must be realistic, because the same people who are overseeing the "last of the gas" were the ones taking notes when "money was no problem" back in the 1970s.

The 2018 revised NEP will be full of fluff without a strengthened Energy Clause and we as a nation will be full of fluff if we do not insist on having and using the Energy Clause to inform us of the costs and benefits of using what is left of our finite reserves. I am not optimistic because a recent survey by the EMA reveals that less than 2% of the population know that the NEP even exists.

Right now many of the long term gas contracts government has with foreign oil/gas companies are coming to an end. The price of the gas that was supplied to them over the period of the “Gas Rush” has never been made public. The new contracts will no doubt also seek to shield the value of the gas from the Public. What we do know however, is that successive governments have always sought to make exploiting our gas as cheap and easy as possible for the foreign investor. Now that getting the gas is more expensive, the foreign companies want more concessions and our government is prepared to give way precisely because there is no Energy Policy.

The government can no longer subsidize our carefree lifestyles of drinking, liming and driving about the place willy-nilly and in some cases, badly wounded. Oil/gas employs less than 4% of the work population and pays 50% of the bills. We are headed for the proverbial brick wall at top speed. The reason for all of this, as I said, is an absent Gas Policy.

It is ironic that, very recently, talk of getting a gas policy has surfaced but it refers to a renewable energy policy. Government is more
Image result for atlantic lng comfortable having a policy for renewable solar energy than finite fossil energy. Never-the-less, the goal set for introducing renewables is 10% by 2021. While this is unlikely, it is also meagre given that household energy consumption in the form of electricity is only 7% of what is consumed nation-wide. This is tiny compared to the massive amounts of energy stripped and exported in the form of LNG, ammonia and methanol every day. There has been a traffic jam of LNG vessels lining up in the Gulf for the last 17 years. They come in empty and leave each with cargoes worth roughly $US 25M of liquefied gas cargo on board. I kid you not!

I will point out one of the several massive elephants that sits in the national room as a result of an absent energy policy. It is the Mission Statement of the National Energy Company of Trinidad & Tobago (NEC) which is: "To be a global leader in the development of sustainable energy-based industries."

When I was a Director of NEC, before I was removed without notice, (I was the only environmental engineer to ever sit in the Board Room of our national energy companies), I pointed out that the NEC was on a Mission Impossible because oil and gas are not by definition sustainable resources. They are finite. They are non-renewable. The tank can empty. It was always a little distracting sitting in the Board room with the huge logo and Mission Statement mounted on the wall. It used to remind me of a TV series called “The Twilight Zone” from back in the day.

We have paid scant regard neither to the earth below our feet, mountains, valleys, our underground aquifers, rivers, coastlines, wetlands and sea, nor to the animals that live in our forests. We have indeed paid scant regard to each other. The Social Code amounts to “the devil take the hindmost”. Service in most public services has never been so bad. The wall is approaching but we will not run out of gas before we hit the wall because we have no Energy Policy. On top of that Government is set to remove the Energy Clause from the 2018 National Environmental Policy.

I would like the NWU, the PEP and even the supporters of the red and yellow, to initiate an island wide conversation about food-water-energy security challenges in this country if we are going to soften the impact of the wall and have a future our children will find worthwhile living in.
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