energy chamber trinidad and tobago _local content panel

8/12/2019 Energy Chamber Trinidad and Tobago _Local Content Panel

1/13

Energy Chamber of Trinidad & Tobago

National Energy Policy Consultation

Local Content Panel

12thJanuary 2011


2/13

Outline:

Local content and ownership

Energy Service sector performance

Energy service exports as diversification

Standards

Legislation

Human resource development


3/13

Definition:

Definition of local company.

Primary consideration is ownership (at least

50%).

Secondary considerations:

Nationality of management Nationality of workforce

Any shareholder agreements that divert profits

Legal registration


4/13

Ownership:

Local content more than local service providers.

Measures to attract local capital investment intothe sectoroil production good possibility.

Listing on stock exchange.


5/13

Services Sector

performance:

2009- 2010 have been terrible years in the local

energy service sector.

Very limited activity

Significant declines in GDP.

Lack of confidence

Decreasing employment Many people moving oversees

Local companies closing or hibernating.


6/13

Energy Sector GDP Growth

-70

-60

-50

-40

-30

-20

-10

0

10

20

30

40

2005

2006

2007

2008

2009

2010

%G

rowth(Decline)

GDP % Change 2005 - 2010

Overall GDP

Energy GDP

Energy Service Contractor GDP


7/13

Wells Started/Completed from

2001-2010

0

20

40

60

80

100

120

140

160

20012002

20032004

20052006

20072008

20092010

Well Completions

Wells Started

Source: MEEA


8/13

Need to export:

Declines in past two-years underline the need

to build a strong export market for local service

companies.

Need a diversified market in order to survive

feast and famine.

But can only successfully export from strong

local baselocal content policy.


9/13

Local content strategy:

Need a policy topromotelocal companies in

the T&T market (not protectionism).

Strategy needs to identify areas of strength andplace support in those sectors where we have a

chance to compete with major international

service companies.

Successful approach used in the development of

platform fabrication industry.


10/13

Role of legislation:

% target spend legislation does not have good

success rate.

Better to target procurement process andpromote use of local companies (Atlantic Train

IV construction example).

Regulations to ensure that local companies have

a fair chance of providing goods and services

procured (but must avoid unnecessary red-

tape).


11/13

Importance of standards:

Adherence to high standards important to:

Help companies export services

Prevent unfair low cost internationalcompetition.

Industry self-regulation has important role to play in

raising standards:

Example: Safe to Work initiative.


12/13

Human resource

development:

Local content not just about companies.

Also about T&T nationals being able to access good

jobs (highest-level) in industry in T&T.


13/13

Energy Chamber strategy:Building a strong platform for sustainable energy sector growth

Efficient

Business

Sector

Strong

Energy

Chamber

Export Energy ServicesPromote Energy Investment

energy chamber trinidad and tobago _local content panel

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