PETROTRIN has inked a deal with Trinidad and Tobago's government that will pave the way for a TT$7-billion ($100 billion) crude oil expansion over the next four years.
The state-owned refinery signed exploration and production licences for two offshore blocks, covering close to 100,000 hectares that will require it to acquire 3D seismic data and drill at least six exploration wells within six years.
The agreement also requires Petrotrin to commit to investing TT$7-billion through to 2017 as part of its TT$12 billion investment in Petrotrin's upstream operations.
Towards the end of 2012, the company's president, Khalid Hassanali, had announced an aggressive plan to drill 20 wells -- two exploration and 18 development wells -- this year.
Indeed, the TT$4-billion capital budget it has committed to roll out over the year to September 2013, is considerably higher than the average TT$2.5 billion spent per year between 2002 and 2011.
The two blocks are not new to Petrotrin.
A 60-year-old block (referred to as Trinmar) comprising 76,000 hectare offshore to the south-west of Trinidad, which was held by a consortium made up of Shell Trinidad, Texaco Trinidad and BP up to June when the licence expired.
The assets of Shell Trinidad, British Petroleum and Texaco Trinidad were acquired by the Trinidadian government and eventually vested into Petrotrin, which maintained and continued oil and gas exploration and production operations until the second licence expiration period in 2012.
The other block (21,000 hectares referred to as North Marine) has been held by Petrotrin since Trintopec's assets were vested to the state-owned refinery in 1993.
The new licences, however, provide for new work programmes, signature and commerciality bonuses, technical equipment, environmental and other bonuses, and abandonment provisions.
Petrotrin is the leading producer of crude in Trinidad and Tobago, having produced approximately 35,000 barrells of oil per day on average (or 42 per cent of the country's total crude output) in the fiscal year that ended in September 2012. It also supplies 49 per cent of Caricom's petroleum products.