Page 59 - PNM General Election 2020 Manifesto

To increase oil production, increase activity and and Tobago at this time is difficult to obtain. This
create jobs, the PNM will: constrains the ability of small oil producers to
increase capital investment and drill more wells.
• Support the national E&P company, Heritage
Petroleum, with the required capital injection to To address this issue the PNM will:
ensure increased exploration and drilling for oil,
proper maintenance, and workovers, and the • Increase the threshold for the imposition of the
improvement of the quality and reliability of its SPT for small onshore oil producers to $75 per
infrastructure barrel for fiscal years 2021 and 2022 in the first
instance

The revenue lost by removing SPT is expected to
be small and will be offset by increased drilling
activity and greater oil production leading to
employment generation and the associated
increased taxes paid by contractors and their
workers.

ENERGY SERVIECS AS A KEY

SOURCE OF DIVERSIFICATION

SUPPLEMENTAL PETROLEUM AND SUSTAINABLE GROWTH

TAX The Trinidad and Tobago energy services sector
comprises approximately 720 firms, providing
A dynamic exploration and development drilling employment for approximately 40,000 people.
campaign in the onshore oil sector will create The development of the energy services sector
jobs, boost economic activity, and increase oil will enable Trinidad and Tobago to continue to be
production. Stimulating investment in drilling is involved in the energy sector even after our
key to providing these jobs and boosting hydrocarbons have been substantially depleted.
economic activity. The PNM will:

A typical onshore development well costs around • Market Trinidad and Tobago as a regional hub
creates up to 200 direct jobs for a month, with a for energy services
total wage bill of $3.3M per well. This represents
a significant injection of income into the • Target and support the energy service sector as
community for each new well drilled. The current a key area for diversification and exports from
Supplemental Petroleum Tax (SPT) poses a Trinidad and Tobago
specific problem when small independent
companies approach potential investors. It kicks • Utilise the EximBank to provide project
in as soon as prices average over US$50 per financing for Caribbean energy sector projects,
barrel and small independent oil companies are with activity to be carried out by Trinidad and
in a negative cash flow situation once prices are Tobago companies
in the US$50 to US$60 per barrel range. Given
that medium term average oil prices over the • Review and reform the energy taxation regime
next 3 years are projected to be in this range, to support and improve exports of energy
investment for onshore oil production in Trinidad services

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PNM THE RIGHT CHOICE ON AUGUST 10 People’s National Movement Manifesto 2020