THE OIL INDUSTRY IN TRINIDAD

OBJECTIVES

1. To identify the factors which influenced the development of the oil industry in
Trinidad

2. To explain the factors responsible for the expansion of of the industry

3. To discuss the problems faced by the industry

4. To outline the positive and negative impacts of the industry on society, the
environment and economy.
1. T
1. Which Caribbean country produces oil?
2. Which section of the country most of the oil deposits can be found

3. What is Trinidad’s main foreign exchange earner?

4. Which section of the country most of the oil deposits can be found
5. In what year was oil first discovered
6. Examine the slide with pictures of gas companies and name them
7. Identify a factor which led to the development of the oil industry in Trinidad
LOCATION OF
THE OIL FIELDS
IN TRINIDAD
Name the areas where most
of Trinidad’s oil fields can be
found.
The Pitch Lake
In 1595 Sir Walter Raleigh found a pitch lake
which was first used to caulk ships. In 1886 the
Trinidad government allowed an American A.L.
Barber to take asphalt from the lake in return
for royalties and duties.

In 1925, because the government wanted an

increased revenue he transferred the
concession to the Trinidad Lake Asphalt
Company.

The asphalt was used for road surfacing, lining

canals and reservoirs, facing dams and for
water proofing of all kinds.
First Geological map- Walls and Sawkins
1859

In 1860, Walls and Sawkins- two geologists,

conducted a survey in Trinidad

Samples were collected to be analyzed

Samples revealed oil and attracted many oil

prospects.

In 1857 an American civil engineer Walter

Darwent drilled the first oil well at Aripero.

Due to inadequate funding he had to abandon

his plans and then died shortly after.

Oil was however not in great demand so it was

not exploited
 Development of Oil Industry
Randolph Rust, a London born businessman arrived in Trinidad in 1881.
He went into business and established the commercial firm Rust
Trowbridge and Company. He was the person who established the oil
industry in Trinidad and struck oil in 1902. He borrowed money from a
Canadian Company and dug well at Guyaguayare.
Development of the industry at Guyaguayare was plagued with problems
such as:
Lack of adequate communication facilities
Unsanitary conditions
Lack of housing and the prevalence of diseases such as yellow fever and
malaria
Guyaguayare was inaccessible, the only road to Port of Spain was a
track along the beaches. Travel was by horse and took several days. This
affected the morale of the staff as they had to be suing horse and cart.
Heavy equipment was needed for drilling and this had to be bought in
by sea and this was dangerous as Guyaguayare was an exposed port.
There was also a number of blowouts
He continued to be involved in oil exploration for the next two decades.
 Vast deposits discovered - an oil beaming belt
Factors which was discovered running across the south of
led to the the island from northwest to southeast.
development of It was also found under the sea off the west
the Oil Industry coast.
in Trinidad Trinidad is a major oil refining centre with
crude oil coming in from Columbia, Venezuela
and Saudi Arabia.
 Government Policies/Investments
Establishment of mines department (1904) in part to
supervise and to provide oversight for the extension of oil
Factors which in Trinidad.
led to the Trinidad began to refine oil from Venezuela in 1930
development of Government encouraged private enterprise in oil production eg.

the Oil Industry 57 oil companies established 1910-1920

in Trinidad National petroleum company established by law (1969)

Trinidad and Tobago National Petroleum Marketing company was
created in 1972.
Stabilization of labour in the oil industry and improvement of
wages within the context of the “Butler Riots” in 1937 and the
unionization of oil workers, which led to the subsequent growth of
the industry.
Trinidad was a beneficiary of OPEC oil price increase between
1973 and 1981. Increased demand for cheaper oil during the oil
crisis meant economic benefits for Trinidad and this in turn
Government Policies cont’d

In 1985 the government acquired Tesoro’s 49.9%

shares in their joint venture thus increasing its direct
involvement in developing the industry

Encouragement of growth in the industry was was done

through the Petroleum Taxes Act in 1974 and the
introduction of a refinery tax.
 Markets Created by the second World War

Britain needed oil for ships, aircrafts, tanks

Factors which and other war vehicles. They decided in 1904
led to the to convert their their navy to oil powered
ships
development of
the Oil Industry New refineries and plants to produce aviation
fuel had been built
in Trinidad
The invention and rapidly developing use of
the internal combustion engine.

Provided fuel for the manufacturing of for

motor cars and lorries

Growing demand for lubricating substances

due to the increasing use of machinery.
Foreign Investments

Early drilling of oil was done by Merrimac Oil Company - a US company

Refineries were established - a number of small ones in Point Fortin in 1912

By 1914 production was able to reach 1 million barrels annually. By 1919 refined oil had increased to
9000 barrels daily and 66% crude oil was being locally refined.

Keeping abreast of contemporary technology contributed to the growth of oil industry eg. use of gas
injection( a method of using nitrogen or CO2 to recover remnants of oil in a well beginning 1933.

Discovery of offshore deposits and commencement of marine drilling from 1954 facilitated the growth of
the industry.
 Factors which Led to Development of Oil Industry

https://www.youtube.com/watch?v=Ucyt52-mo2o

Watch the video and

Outline problems faced by the industry

Impact of the Oil Industry
Contributor to GDP- main foreigh exchange earner.

Since the oil boom in 1970s which occurred with the OPEC crisis, revenue from the
petroleum sector to the government of Trinidad increased substantially. Government
used the additional revenue to diversify the economy. Many nationals of Trinidad
became wealthy from the oil boom and have been investing in a variety of new
enterprises.

Crude oil refiner for Columbia, Venezuela and Saudi Arabia. Trinidad refine crude oil
from Texaco’s Middle East wells and passed it on as gasoline in other products to USA
and countries in the Caribbean

Contributor to national revenue receipts in the form of taxes and royalties.

Impact
Contributor to the diversification of the Caribbean economy, providing a
viable alternative to the dependence on the agricultural sector.

Diversification of the petroleum industry led to the production of petrochemicals, detergents,

sulphur and lubricating oils. Natural gas, ammonia, urea and methanol are produced for export.

Other industries in Trinidad include Angostura bitters which has been expanded, fertilizers, iron
and steel, textiles, clothes, match and soap making, brewing and electric printing and tanning
and food processing factories.

ISCOTT ( The Iron and Steel Company of Trinidad opened in 1980 to provide for the local
building industry in order to reduce dependence on imported products. It currently exports to
Puerto Rico and the Dominican Republic.
 Improved Standard of Living

Greater job creation

Major foreign exchange earner means more money available to invest in social serv

Good quality of education, health and other services

Comfortable homes and establishment of housing schemes with utilities like water, electricity and cooking gas.

Improved standard of living due to wealth generated through industry. Oil and allied products a major foreign
exchange earner.

More responsible corporate citizens emerging and giving donations to charitable organizations

Greater socio-economic stability of families

Higher wages in the the oil sector. More people could afford to buy vehicles and enjoy comfortable lifestyles

Cheap and reliable electricity supply, cheap gas and relatively cheap domestic transportation.
Impact

Positively affected wage

structure

The industry led to rising

wage rates. Workers in the
industry were paid higher and
this encouraged workers in
the agricultural sector to
demand higher wages.
Impact

It contributed to the
development of the physical
infrastructure, roads, railways,
shipping and port facilities which
were required to service the
industry..

Mining towns expanded the

settlement patterns creating new
areas to be serviced by public
utilities.

Modern towns grew up, such as

fortin which had been a settlement
with a few huts when the first oil
was drilled.
 Impact

Job Creation

Industrialization produced rapid economic growth which generated further industrialization such as in
petrochemicals, detergent, sulphur, lubrication, oils and natural gas, all of which offer enhanced
opportunities for employment and career building. The investor was assured labour for his project.

Opportunities for human resource development are significant as the industries offer staff training and
capacity building particularly in a variety of new fields.

Training is provided for these new openings through scholarships and apprenticeship programmes. This
ensure qualified labour is available.

Job opportunities are not restricted to nationals as there is constant migration from other territories. This
movement ensures that there is ample labor for industrial development.

Skilled jobs were taken by British, Americans and Europeans.

Impact
Impact on Labour

Skilled workers for example engineers, mining consultants, administrators, secretaries,

mechanics, machine operators, chemists, geologists, surveyors, marine operators

Unskilled workers for example labourers, porters, security guards, drivers, , cleaners

Apprenticeship scheme for workers

Workers in the essential services such as nurses, doctors and teachers

Construction workers such as building contractors, , carpenters, masons, painters etc.

 Impact

Impact on Women
Movement of women and their families to oil producing areas
Other employment opportunities offered in oil industries such as maids, cleaners, ,
clerical/secretarial, accountants etc.
Employment in complementary servicing eg. teachers and security personnels
Women enjoyed higher standard of living and upward social mobility
Training programmes and scholarships for women in relation to capacity building and staff
development
Bursaries and scholarships for children
Scope for involvement in clubs and societies
Greater involvement in trade unions and political activities
Development of schools and hospitals in oil producing areas helped women and their children
The industry finance sports and as a consequence women and girls benefitted eg. participation at
 Negative Impacts
Pollution

Water contamination due to effluent, wash water and cooling water discharges, and seepage from
storage and waste tanks; • Water contamination due to discharges of water effluents rich in inorganic
salts without appropriate treatment (

Air pollution - Sulfur and nitrogen oxides, ammonia, acid mist and fluorine compounds gas
emissions from production and refining plants operations.

Water contamination due to oil spills

Noise pollution caused by equipment and operations that generate loud noise.

Accidents that impact the environment, such as large oil spills, leaks, fires and explosions on plants. Eventual deaths.
 Negative impact of the Oil Industry

Racism, some jobs reserved for whites

Black workers paid less for equal work.

Deforestation- cutting down trees to drill for oil - forest, bush and deserted
plantations were cleared to build roads and railways

Falling oil prices, or oil crisis can negatively impacts the economy since the
economic development occurs from oil revenue