Trinidad moves to close loopholes in oil and gas tax regime

Dec 21, 2004 01:00 AM

The Trinidad and Tobago Government hopes to have the new oil/gas tax regime applied to the new gas find.
Energy Minister Eric Williams said that Government was trying to have the new oil/gas tax regime in place by the time the reserves in the new gas find are tapped. However, Williams stressed that Government was continuing to have discussions with all the key stakeholders about the new regime "so that there would be no surprises."

He said the new regime "quite probably" would be in place by the time the new reserves come on stream, "but the whole thing is an ongoing discussion and the committee of people (that is) working on it would be meeting with the key stakeholders to discuss the new approach." He added that at the end of the day, whatever regime is in place will be applied to the existing scenario.
Williams announced that a "significant gas discovery" had been made off Trinidad and Tobago's east coast. The 2 tcf find by bpTT is the largest single gas-well resource to date, he said.

Earlier this year, there were calls for Government to amend the oil and gas tax regime, especially in light of increasing prices on the global market. Trinidad and Tobago derives greater revenues from gas than oil, though oil continues to be significant.
Economists argue that the current tax structure governing oil and gas companies allow them to write off certain expenses, and that companies have taken advantage of this loophole to avoid paying taxes on windfall profits. Referring to the LNG contract, Williams noted that revenues being reported to Trinidad and Tobago were less than what were being received because of loopholes in the LNG contract. Government was seeking, therefore, to reopen this contract, he said.

Source: Business Wire
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