T&T and Venezuela sign historic gas deal

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.

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 300 million cubic feet per day of natural gas from four wells. 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 using Shell's pipelines to the Hibiscus platform off the north-west coast of Trinidad, just 18 kilometres from the gas field. Hibiscus is jointly owned by the government (NGC) and Shell. 

The project involves the construction of a 30km gas pipeline - construction of pumping stations, metering systems and related facilities, the laying of gas pipelines, and the installation of safety and control systems.

3. Details of the deal are 'confidential', according to Dr Rowley, but he said the agreed-upon price was better than others. 

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.

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