ConocoPhillips makes move to offload Trinidad and Tobago assets

Curtis Williams
OGJ correspondent

PORT OF SPAIN, Oct. 30 -- ConocoPhillips has decided to pull out of Trinidad and Tobago and immediately sell its shares in Phoenix Park Gas Processors Ltd. (PPGPL) along with a number of North American interests. Company officials confirmed the sales, which are expected to be completed within the next 6 months as the newly merged ConocoPhillips attempts to restructure its operations.

Linsi Crain, a company spokeswoman, told OGJ that the move is in keeping with ConocoPhillips's decision to streamline its midstream assets as it attempts to maximize the benefits from the merger of the former Conoco Inc. and Phillips Petroleum Co..

"An evaluation of ConocoPhillips midstream assets and their place within the long-term objectives and strategies for ConocoPhillips has been under way," Crain said. "As a result of this review, certain midstream assets have been designated for sale. Consistent with that decision, a marketing process has been initiated for Phoenix Park."

Crain continued, "ConocoPhillips is continually looking for opportunities to improve our business holdings and portfolio around the world. This possible sale is part of a company-wide and global effort to streamline our business and to realize the full value of the recent merger."

Assets sale details
PPGPL is ConocoPhillips's sole interest in Trinidad and Tobago. Crain said, "While Phoenix Park has performed attractively both financially and operationally and is located in a stable environment and has an excellent outlook, others may see it as more beneficial to their portfolios."

ConocoPhillips told OGJ that it remains interested in exploration and development opportunities in Trinidad and Tobago but wouldn't disclose details.

Meanwhile, Crain said ConocoPhillips also will be disposing of several other assets, notably its Southeast New Mexico operating unit, San Angelo operating unit, Louisiana operating unit (excluding the residue system), Gulf Coast Fractionators, Mont Belvieu Storage, Atlantic Energy Terminal, and Glenmora Pipeline. Sale of the US assets is anticipated to be complete by the first quarter of 2004.

OGJ has been told that while the Trinidad and Tobago operations are profitable, they are too small for ConocoPhillips to continue to operate. PPGPL is a Trinidad and Tobago-based joint venture of ConocoPhillips, National Gas Co. Ltd. of Trinidad & Tobago, and Pan West Engineers & Constructors.

NGC has a controlling interest of 51%, while ConocoPhillips owns 39%.

NGC's interest in PPGPL
PPGPL started operations in 1991 as a gas processor and export marketer of natural gas liquids, including propane, butane, and natural gasoline. It is the leading producer and marketer of NGLs in the Caribbean; it also exports NGLs outside the region.
PPGPL has embarked of a multimillion-dollar upgrade as it prepares to deal with additional amounts of gas feedstock entering the system from the major Trinidadian gas projects, including the Atlantic LNG expansion.

Only last year, PPGPL announced a plan to expand its operations and to develop a Caribbean liquids hub with the possibility of utilizing gas from both Trinidad and Tobago and from Venezuela's Plataforma Deltana offshore region. Projects currently under development will by 2005 double the company's 2001 plant production.

NGC Pres. Frank Look Kin acknowledged that ConocoPhillips wanted out of the plant and said this has already been indicated in writing to the other shareholders. He said NGC is interested in purchasing the assets "if the offer was right."

Look Kin said, "We know what the plant is worth, and we will make a decision on whether we buy the assets whenever ConocoPhillips sets a price. There is no doubt that we want to acquire the assets, but they must first set a price."

The NGC president said Trinidad and Tobago had already been informed of the development, and NGC had informed Energy Minister Eric Williams about its interest in buying the assets.

"There is a particular procedure set out in these kinds of matters that has to be followed," Look Kin said. "Under the shareholders' agreement, NGC has the first right of refusal, and so ConocoPhillips will have to find a buyer and when that buyer makes an offer [ConocoPhillips] will then approach us and tell us this is their price. We will look at it and determine if it is fair, and if it is then surely we will buy it."

Look Kin added, "They told us they wanted to deal with this issue before the end of the year, and we are prepared to deal with it as soon as it is brought to us so we are waiting on them."

Williams also spoke on the issue and said he is sorry to see the company leave. "It is a pity that they are leaving Trinidad and Tobago, but it is a decision they have to make and having made it the government can only wish the company well in its restructuring efforts," Williams said.

Business as usual
Look Kin assured that ConocoPhillips's decision will not adversely affect NGC's plans to use Phoenix Park gas processors to provide the ethane feedstock required to support a world-scale ethylene plant.

Both NGC and the Caribbean island government have been pursuing an ethylene complex. They contend that, on completion of Atlantic LNG's Train 4 in 2005, it will have sufficient ethane in the system to support a world-scale ethylene plant.

Look Kin said, "I don't think the sale of the plant will have any effect on our plans. The fact is that the company will have to follow the dictates of the directors, whoever the shareholders are."

Look Kin said NGC and the government's policy of attracting an ethylene complex to Trinidad and Tobago had not changed and will not regardless off the changes at PPGPL.

NGC Chairman Keith Awong also is chairman of PPGPL.

Related Articles

Inhofe, Lankford say new BIA rules threaten Osage oil operations

07/10/2015 New US Bureau of Indian Affairs regulations that increase production expenses on tribal lands could put the Osage Nation out of business, Oklahoma’...

House panel’s crude export ban hearing weighs urgency against caution

07/10/2015 A US House Energy and Commerce subcommittee hearing on legislation to repeal the ban on exporting US-produced crude oil quickly broke along party l...

Chevron Phillips Chemical makes executive appointments

07/10/2015

Chevron Phillips Chemical Co. LLC has made several executive appointments, all effective Aug. 1.

Twelve workers killed in Nigeria pipeline explosion

07/10/2015 Eni SPA reported that an explosion occurred July 9 at the repair site for the Tebidaba-Clough Creek oil pipeline in Nigeria’s onshore Niger Delta.

Gov. Tomblin forms West Virginia oil, gas safety commission

07/10/2015 West Virginia Gov. Earl Ray Tomblin (D) established the oil and gas safety commission he announced in his 2015 State of the State address. The grou...

MARKET WATCH: NYMEX, Brent crude oil prices rebound more than $1/bbl

07/10/2015 Prices for US light, sweet crude oil and Brent crude each rebounded by more than $1/bbl on their respective markets July 9, and analysts attributed...

Transco seeks FERC approval for New York Bay Expansion project

07/09/2015 Transcontinental Gas Pipe Line Co. LLC (Transco), a wholly owned subsidiary of Williams Partners LP, has filed an application with the US Federal E...

House Oversight panel subpoenas Kerry for Keystone XL documents

07/09/2015 The US House Oversight and Government Reform Committee issued a subpoena to US Sec. of State John F. Kerry for reports, recommendations, letters, a...

MARKET WATCH: NYMEX crude oil prices drop for fifth consecutive trading session

07/09/2015 US light, sweet crude oil prices settled slightly lower on the New York market July 8 for the fifth consecutive trading session, and analysts attri...
White Papers

2015 Global Engineering Information Management Solutions Competitive Strategy Innovation and Leadership Award

The Frost & Sullivan Best Practices Awards recognise companies in a variety of regional and global...
Sponsored by

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by
Available Webcasts

On Demand

OGJ's Midyear Forecast 2015

Fri, Jul 10, 2015

This webcast is to be presented by OGJ Editor Bob Tippee and Senior Economic Editor Conglin Xu.  They will summarize the Midyear Forecast projections in key categories, note important changes from January’s forecasts, and examine reasons for the adjustments.

register:WEBCAST


Predictive Analytics in your digital oilfield - Optimize Production Yield and Reduce Operational Costs

Tue, Jul 7, 2015

Putting predictive analytics to work in your oilfield can help you anticipate failures, plan and schedule work in advance, eliminate emergency work and catastrophic failures, and at the same time you can optimize working capital and improve resource utilization.  When you apply analytic capabilities to critical production assets it is possible to reduce non-productive time and increase your yield.

Learn how IBM's analytics capabilities can be applied to critical production assets with the goal of reducing non-productive time, increasing yield and reducing operations costs.

register:WEBCAST


Cognitive Solutions for Upstream Oil and Gas

Fri, Jun 12, 2015

The oil & gas sector is under pressure on all sides. Reserves are limited and it’s becoming increasingly expensive to find and extract new resources. Margins are already being squeezed in an industry where one wrong decision can cost millions. Analyzing data used in energy exploration can save millions of dollars as we develop ways to predict where and how to extract the world’s massive energy reserves.

This session with IBM Subject Matter Experts will discuss how IBM Cognitive Solutions contribute to the oil and gas industry using predictive analytics and cognitive computing, as well as real time streaming for exploration and drilling.

register:WEBCAST


The Alternative Fuel Movement: Four Need-to-Know Excise Tax Complexities

Thu, Jun 4, 2015

Discussion on how to approach, and ultimately embrace, the alternative fuel market by pulling back the veil on excise tax complexities. Taxes may be an aggravating part of daily operations, but their accuracy is crucial in your path towards business success.

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected