Trinidad and Tobago Scrutinizes Proposed Ibis Steel Plant Business Model

The proposed Ibis Steel Plant in Trinidad and Tobago is being scrutinized by the government's negotiating team, comprising the National Gas Company (NGC), Ministry of Energy and Industries (MEEI), Ministry of Public Utilities (MoPU), and the Trinidad and Tobago Electricity Commission (T&TEC) among others.

The project's business model and alignment with former ArcelorMitTal assets are becoming clearer. The team will analyze the economics of this venture, including supply agreements for natural gas, electrical power, site leases, port fees, water, and fiscal incentives.

A high-level analysis indicates that if the negotiated price of natural gas falls US$1 below its next-best alternative market option, the total state subsidy would be approximately US$51.1 million annually. If the natural gas discount reaches US$2, the total implicit subsidy escalates to roughly US$65.3 million per year.

The project's projected domestic benefits, including direct employment and local operational spending, amount to approximately US$64.5 million annually.