By SEAN DOUGLAS Sunday, November 9 2008

PRIME Minister Patrick Manning said motorists would be able to fully access Compressed Natural Gas (CNG) within two years, after which he would end the hefty sum paid by the Government to National Petroleum (NP) to subsidise the price paid for gasoline at the pump -— yesterday said by Energy Minister Conrad Enill to be $2.6 billion.

The disclosure came on Friday night in the House of Representatives during debate on an order to cut the excise-duty on CNG from 21 cents to five cents per litre-equivalent.

Manning admitted the past woes that had hampered motorists uptake of the CNG option, but listed the initiatives since then to make CNG more attractive.

He said that in contrast to the previous heavy tanks required to hold the pressurised gas CNG, nowadays tanks were made of a composite material and were thereby lighter. Further, he said two Radio 94.1 FM broadcasters misled the public that CNG tanks were not safe in a car collision, in an incident where he personally and controversially visited the station to complain about the broadcast.

Suggesting a CNG tank was safer than a gasoline-tank, he retorted: “If you are hit from behind, you will meet a fuel tank before you meet a CNG tank.” He added that gasoline was far more volatile, that is combustible, than CNG.

Manning concluded: “It will take two years for CNG to take off. There will be no subsidy reduction for two years. We plan no increase in gasoline prices until we give citizens a proper alternative (to gasoline) to use CNG.”

Siparia MP Kamla Persad-Bissessar queried the Government’s broader energy policy, alleging that in this country’s current oil/gas boom, the Government was repeating the mistakes of the 1970s oil boom.

At that Manning rose to say the country’s financial problems of the 1980s had been caused by a collapse in the oil price down to US$8 per barrel, not by profligate government spending.

That simply gave Persad-Bissessar more fuel for her argument, as she accused the government of now not putting aside sufficient funds in case of upcoming price shocks that the PM had just recalled. She recalled that in her Budget speech she had warned that the Government’s predicated oil price of US$70 per barrel was too optimistic, and she said earlier Friday the various oil prices had fallen to between US$57.25 and US$60.68 per barrel.

Manning again interjected to claim that the Budget was devised using sound assumptions, with no one predicting the collapse of the financial market.

Persad-Bissessar retorted that the global crisis had been predictable, and said shrinking economies would now mean less demand for TT’s oil and gas exports.

She also feared a depletion of TT’s natural gas reserves.

Manning again interjected to say TT’s reserve-to-production ratio has in fact improved from “12” some two years ago to a current “13”. He added: “Since the Ryder Scott Report was published, we have two gas discoveries.” He also said that TT has now diversified its LNG export markets to now include Japan, Brazil, Argentina and Mexico, in addition to the usual USA.

An unmoved Persad-Bissessar said this diversification would not help in the face of a global economic meltdown, and TT still faced financial shocks.

She hit the Government for not retaining Caroni (1975) Limited and using it to grow sugarcane for biofuel. Manning retorted that TT’s acreage is too small for biofuel to be viable, but Persad-Bissessar asked whether this claim was ever proven by a feasibility study.

She asked whether the 200 luxury cars sought by the Government for two summits in TT next year would be run on CNG, but Government MPs responded by laughing aloud. The Excise Duty (Compressed Natural Gas) Order 2008 was passed.