Fresh Deals to Boost Trinidad’s Natural Gas Production

SEATTLE (Oil Monster): The two recently signed deals are likely to boost natural gas production in Trinidad & Tobago. Although they are not expected to provide short term boost to the country’s total output, they will help the country in maintaining its leadership position in liquefied natural gas (LNG) export market.

Trinidad & Tobago awarded three deepwater blocks off its east coast to a consortium of companies comprising of oil majors including BP and Shell. The three blocks- 25a, 25b and 27 were put on offer in a bidding process that ended last year. The consortium had submitted bid for block 23b as well, but negotiations are still in progress for the same, said a press release by BP.

According to Stuart Richard Young, the country’s energy minister, the contract negotiations with the consortium were complex, due to the location of the blocks and the uncertainties with regards to exploration and future production capabilities.

Initial exploration in deepwater areas had confirmed reserves of commercial natural gas, although it could take years for commencement of production. The technical information report says that it would take at least three years for production to begin once the final investment decision is made.

In addition, Trinidad & Tobago also signed a profit-sharing agreement with Venezuela towards gas exports from the Dragon field.