The failure of BHP’s deep-water well Broadside is a major blow to the hope of finding huge recoverable reserves of crude oil offshore Trinidad and Tobago.

Having found a significant amount of natural gas in its Northern acreage, BHP was hoping to replicate its exploration success by making a major oil discovery in the south. This was not to be.

To fully understand the importance of this well and the drilling that has taken place in the deep-water, it is necessary to explain the nature of exploration.

Trinidad and Tobago has been in the oil and gas business for over 100 years. During that time, the country has found and produced more that three billion barrels of oil and 20 trillion cubic feet of natural gas. All of these discoveries have been made on land or on what is called the continental shelf. However, hydrocarbons are not infinite and to find more you need to keep on looking and to find large amounts you are likely to be successful in areas never before explored rather than places you may have originally missed.

With this in mind and the fact that T&T has not been making large discoveries either on land or near-shore, the consensus is that the next frontier of exploration success is in the deep-water.

The huge discoveries in the Guyana/Suriname basin and in West Africa have given greater hope that the same success could be replicated here.

This has not been the story thus far and while four wells have been drilled in the deep-water in what is called BHP’s Southern Province, no oil has been found.

It is true that many companies searched for oil off this country’s east coast and were unsuccessful before Amoco and so there is always that possibility of future finds, but the failure of Broadside will give BHP and the Government real reasons for concern.

The country desperately needed this well to be successful because it is hoping to attract major interest when it puts out additional blocks for exploration early next year. It was hoped Broadside would have de-risked the area but the failure has instead increased the risk profile.

The failure of Broadside means that the expected increase in exploration activity in the neighbouring blocks is now unlikely to happen, resulting in less activity in the crucial sector.

With the concern for climate change and the cry that the world must become carbon neutral, it is expected that fossil fuel will be phased out and long before that, decline in value. It means now is the time to urgently find and produce oil and gas and use the money wisely to build an economy not dependent on its production.

T&T has been down the road of failure before and depended on the success of one well and it took us more than a decade to recover from BP’s Ibis Deep failure.

One hopes this is not to be replicated.