Trinidad and Tobago EITI Report 2018
Chair, TTEITI Steering Committee
A graduate of the University of the West Indies, Mr McGuire holds bachelor's and master's degrees in economics. He has also had extensive post-graduate management training at the Balanced Scorecard Collaborative, Harvard Business School, MW Kellogg School of Management, Oxford College of Petroleum Studies, and the London Strategic Planning Society. Mr. McGuire has had a distinguished career in Business spanning thirty years. He spent 23 years at the National Gas Company of Trinidad and Tobago Limited,( NGC) where he had managerial responsibility mainly for the Strategic Planning and Marketing process.
This is the seventh Trinidad and Tobago EITI Report, which includes EITI revenue data from the period 1st October 2017 to 30th September 2018. The Independent Administrator’s work was carried out between February 28, 2020 and February 25, 2021 in accordance with the Terms of Reference included in Appendix 8.2. The report is based on information received up to February 23, 2021. Information received after this date has not been taken into account. The report was prepared during the Covid-19 pandemic, during which there were restrictions imposed on the movement of individuals and face to face meetings were not permitted during certain periods. In line with efforts by TTEITI towards mainstreaming extractive industry data, information which is available online is not reproduced in this report, instead reference is made to the online location for such data. The report is intended for the use of the TTEITI Steering Committee for the purpose of that initiative and is not to be relied upon by other parties. The report includes its Appendices, which are provided separately.
Key Takeaways
- There is room for improved transparency by the GORTT to meet the requirements of the EITI Standard
- T&T's mining sector still owes TT$200 million in outstanding royalties
- The Ministry of Energy's PSC audit unit disallowed US$77 million in costs for PSCs between 2018-2019, yet there are still 79 outstanding revenue audits and 304 outstanding cost audits
Welcome to Trinidad and Tobago’s seventh annual Extractive Industries Transparency Initiative (EITI) Report. The country has been implementing the EITI for a decade and this year’s report arrives at a time when the Covid-19 pandemic has severely impacted the economy and nation. The combined direct and indirect impact of the pandemic plus depressed oil, gas and petrochemical prices and declining production have pushed Trinidad and Tobago into a deep economic recession. The Government has been forced to trigger a massive multi-billion dollar relief programme to support workers and businesses impacted by the pandemic. Thankfully, Government has been able to partly finance the relief programme by drawdowns from the Heritage and Stabilisation Fund, which was established to meet shortfalls in revenue from a crisis of this nature.
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Trinidad and Tobago is in an economic quagmire as current reality conflicts with aspirations in several areas. Government is grappling with a precipitous decline in revenue while seeking to manage expenditure and save jobs, with a high fixed current expenditure profile. The erosion of our competitiveness as a location for gas based industries has called into question the long-term viability of our long standing gas monetisation model. The prognosis of energy commodity prices remaining depressed beyond the short term does not augur well for the economy. Notwithstanding adverse trends, Government continues to press the energy sector development accelerator by launching new bid rounds for exploration acreage and granting approval for the first large scale renewable energy project sponsored jointly by the private sector. Given this uncertainty, sharing up to date information on oil, gas and mining revenue, policy changes and the future outlook for these sectors will be paramount. This report reconciles Government's payments for fiscal year 2018. However, the SC has included up to date information on the Government’s revenue from royalties and profit share from production sharing contracts and other key parameters for the period up to 2020.
Over the last year, we have been focussing on advancing the practice of systematic disclosure whereby EITI information becomes available at source within the relevant Ministry websites and is not confined to EITI Reports. In 2021, the SC will embark on a pilot with the EITI International Secretariat concentrating on the steps necessary for systematic disclosure to become the norm. Our new work plan for 2021-23, also targets an increase in mining sector participation in TTEITI and the passing of TTEITI legislation. We will also go through our second Validation where our performance against the 2019 Standard will be assessed. This report therefore introduces several innovations.
The SC and Secretariat are expanding focus beyond revenue transparency to other areas that support greater transparency and accountability in the extractive sector as well as act as a disincentive to corruption. The following are examples of that expanded focus, some of which are reflected in this report:
Production sharing contract analysis
Environmental reporting
Contract Transparency
Beneficial ownership disclosure
Open data and open budgets
These innovations are being introduced because the EITI, as a dynamic initiative, is responding positively to the evolving challenges in its member-countries while upholding an international standard and accommodating the different national realities and contexts. In Trinidad and Tobago, the EITI continues to provide a collaborative mechanism and platform for developing and consolidating transparency and accountability in the nation's oil and gas sectors, the cornerstone of the national economy. The collating, verifying and sharing of these sectors’ data will build a better understanding among citizens on how the government is using the country’s scarce non-renewable natural resources in a time when revenues are shrinking. The SC’s aim is also to ensure that the EITI is relevant to and effective in targeting national priorities, including digitalisation and local Government reform on participatory budgeting.
On behalf of the TTEITI Steering Committee and Secretariat, I wish to acknowledge with thanks the roles played by the stakeholders - Government, extractive companies and civil society - in guiding and supporting EITI implementation over the last year and in producing this report. In particular, I recognise the Ministry of Energy and Energy Industries and the Ministry of Finance’s Board of Inland Revenue and Investments Division for their contributions. Also, I recognise the EITI Independent Administrator, BDO Trinity Limited, supported by Hart Nurse Limited, for their professionalism in conducting the sector surveys and reporting on their findings for all the EITI Reports we have published to date. Finally, I want to thank the TTEITI Steering Committee and the Secretariat for their daily contributions to EITI implementation. I am optimistic that the information provided in this report will advance dialogue and debate on the country’s extractive sector. My fervent hope is that we all continue to support the EITI’s journey for the next decade and beyond.
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