By Curtis Williams and Mayela Armas
HOUSTON/CARACAS (Reuters) – British oil and gas producer BP, Venezuela’s state-owned oil company PDVSA and Trinidad and Tobago’s National Gas Company are accelerating negotiations on a Venezuelan license to develop natural gas reserves in the Caribbean Sea, four people familiar with the matter said.
Last year, the companies resumed negotiations to develop the Cocuina-Manakin gas field on the maritime border between Trinidad and Venezuela. The field contains about 1 trillion cubic feet of natural gas.
Talks have progressed since the U.S. granted approval for the project in May, creating an exemption from energy sanctions against Venezuela. The parties are now aiming to sign the Venezuelan license needed to develop that part of the field before the South American country holds presidential elections on July 28, the sources said.
A ceremony to sign the licenses planned for last week was postponed because agreements still needed to be finalized. Trinidad’s Energy Minister Stuart Young recently traveled to Caracas to attend some meetings, the people added.
BP declined to comment on the matter, having previously stated that it was actively pursuing the development of the field. PDVSA, NGC and Trinidad’s energy minister did not immediately respond to requests for comment.
BP plans to use the gas primarily for Trinidad’s flagship Atlantic LNG project. A smaller portion of the production will go to NGC for use in Trinidad’s petrochemical industry, two of the people said.
Trinidad is Latin America’s largest LNG producer and the world’s second-largest exporter of methanol and ammonia, but the industry there has suffered from natural gas shortages over the past five years. Atlantic LNG has the capacity to produce around 15 million tonnes of the supercooled gas annually.
The US approval for Cocuina-Manakin is the second for Washington’s energy projects between Trinidad and Venezuela, which are crucial in the region to secure natural gas for international markets.
Early last year, the US Treasury Department had already granted Shell a license to develop the Dragon gas field in Venezuela. The project, whose infrastructure was partly built by Venezuela but is still idle, could start producing gas by the end of next year.
Gas from both projects will be converted into liquefied natural gas in Trinidad and exported to neighboring Caribbean countries, Venezuelan and Trinidadian officials said.
(Reporting by Curtis Williams in Houston and Mayela Armas and Deisy Buitrago in Caracas; additional reporting by Marianna Parraga; editing by Bill Berkrot)
