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Trinidad and Tobago cancels gas deal with Venezuela

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Reuters is reporting that Trinidad and Tobago has cancelled an agreement with Venezuela for the joint development of a natural gas field straddling their maritime border because of US sanctions on Venezuela’s state energy company PDVSA.

The Caribbean island nation is a major exporter of LNG, but its own offshore natural gas output has been declining in recent years.

That has raised the possibility of using gas from neighbouring Venezuela, which has large untapped offshore gas reserves, to feed LNG plants in Trinidad.

Trinidad and Tobago’s prime minister, Keith Rowley, said on Monday during an energy conference in Port of Spain that the two countries will now independently develop the 10.04 trillion ft3 Loran-Manatee shallow-water field.

“Progress in the development of the unitised Loran-Manatee field has been impeded by the sanctions imposed by the US government, which inhibits US companies from doing business with Venezuelan oil company PDVSA,” Rowley said.

Under the agreement signed between the two countries in 2013, 73.75% of the joint field belongs to Venezuela and the rest to Trinidad and Tobago.

Chevron Corp. holds a 60% interest in the Loran field, with the remainder held by PDVSA, while Shell Trinidad and Tobago holds a 100% interest in the Manatee field.

Rowley said gas production from the Manatee field could start by 2024 or 2025 at rates ranging from 270 to 400 million ft3/d.

He said the decision to independently develop their fields also has implications for the development of other cross-border fields, the Mankin-Cocuina and the Kapok-Doradoh. These are estimated to hold 850 billion ft3 of gas within the Trinidad and Tobago maritime area.

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