Venezuela and Trinidad and Tobago have signed a unitization and unit operating agreement for the development and production of the 10-tcf Loran Manatee cross-border natural gas fields that the two countries share.
The agreement was signed in Port of Spain during a visit to the Caribbean island by Venezuela President Nicolas Maduro Moros and Trinidad and Tobago Prime Minister Keith Rowley.
The agreement means that the consortium that have the license to operate the fields will have 3 months to put forward a development plan to the two governments and then proceed and develop the massive gas fields.
Now that Royal Dutch Shell PLC has taken over BG Group, the ownership of Loran Manatee has changed to Chevron Corp. and Petroles de Venezuela SA (PDVSA) on the Venezuelan side and Chevron and Shell on the Trinidad and Tobago side of the border.
The companies have been having regular meetings on the issue and only last week met in Port of Spain as they tried to move forward the eventual development of the field.
Rowley also hinted that the gas will be exported as LNG to international markets saying both countries have agreed to approach the international marketplace following the agreement.
There had been some speculation that part of the gas could be used for Trinidad and Tobago’s domestic supply because the Caribbean island, which is the largest exporter of methanol in the world, has been having gas shortages since 2011.
BP PLC’s Juniper project is expected to bring that shortage to an end in 2017.
It was also decided that all the gas will be processed in Trinidad and Tobago, which already has significant infrastructure in the area and therefore ending speculation that some of the gas will be processed in Venezuela or used by that country to assist in electricity production.
In addition Trinidad and Tobago has agreed to provide Venezuela with significant manufacturing products that could help Maduro in his attempts to stave off efforts to depose him from power and to reduce the thousands of Venezuelans who are pouring into the Caribbean island both to migrate and to seek basic products inclusive of food which they then take back to Venezuela.