NGC Faces Uncertain Future Amidst Declining Gas Production
The National Gas Company of Trinidad and Tobago (NGC) has been instrumental in maximizing the value of the country's natural gas resources for over five decades. Founded in 1975, NGC initially focused on purchasing, compressing, transporting, and selling natural gas to commercial and industrial users. Over time, its role expanded to include a pivotal position in the construction of liquefied natural gas (LNG) trains and attracting international investors to establish world-scale ammonia, methanol, and urea plants.
However, as the global energy landscape changed, NGC faced significant challenges. The decline in natural gas production led to steep dips, replacement costs increased due to inflationary pressures, complexity, and subsurface challenges. This reality prompted a reduction in the term of upstream-to-NGC supply agreements and downstream company supply agreements.
The transformation of external markets for commodities produced in Trinidad and Tobago further complicated NGC's situation. The USA's shale gas revolution turned it from an importer to an exporter of products, while Europe implemented measures to address its drive towards a lower-carbon future through the carbon border adjustment mechanism (CBAM). This led to a significant challenge for downstream producers in Trinidad and Tobago.
NGC has attempted to adapt by signing amended supply agreements. In 2023, it signed an agreement with Shell for gas from Manatee production for its downstream customers for the medium term. NGC also entered a two-year gas supply agreement with EOG in May 2026 for its downstream customers, including power generation and LNG.