Trinidad and Tobago’s energy industry has suffered another setback after Shell halted development of its Aphrodite offshore gas project.
The decision follows unsuccessful negotiations with Trinidad’s National Gas Company over the commercial terms for purchasing the gas that would have been produced by the project.
The Aphrodite project was expected to produce approximately 100 million cubic feet of gas per day.
Trinidad and Tobago has historically been one of the Caribbean’s most important energy producers and is Latin America’s largest LNG exporter.
However, declining natural-gas production has placed pressure on the country’s energy and petrochemical industries.
The government is looking at new sources of gas, including supplies connected to neighbouring Venezuela, as it attempts to protect Trinidad’s position as an important energy hub.
What does this mean for ordinary Trinidadians?
The energy industry provides employment, government revenue and foreign exchange.
A decline in production could therefore have consequences beyond the oil and gas companies themselves.
On the other hand, Trinidad’s dependence on energy exports also highlights the importance of diversifying the economy.
The big question is whether Trinidad can use its remaining energy resources to build new industries before declining gas production becomes a bigger economic problem.
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