Tuesday 20 November, 2018

T&T and Venezuela sign historic gas deal

Prime Minister Dr. Keith Rowley and Venezuela President Nicolas Maduro have signed a historic gas deal, which will allow T&T to access gas from Venezuela’s Dragon Gas Field.

The Prime Minister along with a delegation arrived in Caracas, Venezuela on Saturday for the signing of the agreement of the final terms for the development of cross-border gas from the Dragon Gas Field between NGC, PDVSA and Shell.

The delegation included Minister of Energy Franklin Khan, Minister of National Security Stuart Young, Minister of Sport Shamfa Cudjoe, Minister of Foreign and CARICOM Affairs Denis Moses, Minister in the Ministry of Finance Alyson West and high-level executives of NGC and Shell.

The historic signing took place at the Palacio de Miraflores in Caracas.

Speaking following the signing, Prime Minister Rowley hailed the agreement.

“What we have just witnessed is the coming together, in a situation which existed for two years but which has now come to the fore, to be operationalised for the people of T&T and the people of Venezuela.

"Geologically we are connected and historically we have used our hydrocarbon resources as the engines of both our economies. There have been many changes some for better, some for worse but in recent times under recent and current leadership, a new impetus has attended our requirement to cooperate in our hydrocarbon legacy."

"Trinidad and Tobago is a processor and exporter of natural gas. Venezuela's resources of natural gas have never been an input but after today...Venezuelan gas will come to the international marketplace to be monetized for the benefit of the people of Venezuela and the people of Trinidad and Tobago...and that being so, the sky is the limit,” Dr Rowley said.

He added that interesting discussions were had and said this model of cooperation shows tremendous promise for cooperation in other areas.

T&T and Venezuela sign historic gas deal

Five things to know about the Dragon Field gas deal

1. The Dragon field, part of the Mariscal Sucre offshore gas project, is projected to produce an estimated 150 million cubic feet per day in the first year, with plans to increase to 300 million cubic feet later on. The Dragon Field contains approximately 2.4 trillion cubic feet of natural gas. 

The Mariscal Sucre Dragon and Patao fields, located in water depths between 328-427 feet (100-130 metres), are situated nearly 25 miles north of Venezuela’s Paria peninsula in Sucre state. 

It's expected that production from Venezuela's four fields which comprise the Mariscal Sucre project – Mejillones, Rio Caribe, Dragon and Patao – will reach 1.2 billion cubic feet per day of natural gas and 28,000 barrels per day of condensates, and will be directed primarily toward export.

 

2. The gas will be transported to the Hibiscus platform off the north-west coast of Trinidad, just 18 kilometres from the gas field. Hibiscus is jointly owned by the T&T government (NGC) and Shell. 

According to a report by Offshore Energy Today, the project scope covers supply and installation of subsea flowlines, supply and installation of gas processing equipment onshore, and operational support for the subsea, offshore and onshore facilities.

Technip has been contracted to oversee procurement, installation and operation support contract by Petroleos de Venezuela S.A. (PDVSA), covering subsea, onshore and offshore facilities for an accelerated production system on the Mariscal Sucre Dragon development.

In March 2017, Shell signed an agreement with NGC and PDVSA to build a 17km pipeline from the Dragon Gas Field to the Hibiscus platform.

 

3. Details of the deal are 'confidential', according to Dr Rowley, as per the terms of the agreement, but he said the agreed-upon price was 'competitive'.

According to a release from PDVSA Minister of Popular Power of Petroleum and president of Petróleos de Venezuela, SA (PDVSA), Manuel Quevedo, will travel to Trinidad and Tobago to pursue agreements for 'a comprehensive oil association and gas at all levels, with the idea of boosting the full potential of both nations in terms of energy'.

 

4. In the first phase, the gas from the Dragon will boost the country’s gas supply for both the LNG and the petrochemical sectors. T&T plans to expand domestic gas production to 4.14 Bcf/d by the end of 2021.

 

5. The project will cost an estimated US$100 million, according to media reports. First gas from Dragon is expected in 2020.

 

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