The US has granted an amended license as Shell, Trinidad and Tobago push for a Venezuelan gas deal

The island nation of Trinidad and Tobago aims to take a “significant step forward” in obtaining Venezuelan natural gas to support domestic demand and LNG exports after the United States granted an amended license, according to Energy Minister Stuart Young.

At a news conference late Tuesday, Young said he expects completion negotiations with Venezuela to buy natural gas from the offshore Dragon field after the US Treasury agreed to allow development partners to pay in hard currency as well as humanitarian contributions.

Young said the ministry plans to continue meetings with Shell plc, Trinidad’s state-owned National Gas Co. and the Venezuelan government to “get into the nitty-gritty level of detail” to determine the price of Dragon natural gas.

“Very soon I will lead the team back to Venezuela. to complete these arrangements” added Young.

While the ministry is still coordinating with Shell engineers and securing further regulatory approvals, Young said gas could potentially be introduced to Shell’s Hibiscus offshore platform in less than two years once “all the green lights are given”.

United States originally granted to Trinidad development license at the beginning of the year. But Young said restrictions on the type of payments countries can make to Venezuela have stalled negotiations. In May, Trinidad formally asked US officials to change the license terms.

The amendment also extends Trinidad’s development license until October 31, 2025.

Dragon Field is roughly 11 miles off the coast of Trinidad. Venezuela’s state-owned Petróleos de Venezuela has announced that 4.2 Tcf of reserves have been found in Dragon since development began more than a decade ago. Ongoing geopolitical issues and sanctions against Venezuela prevented capital partners from entering the project.

Earlier in the week, various media outlets reported that Venezuela and the United States may be negotiating a deal to potentially ease sanctions in exchange for Venezuela adopting electoral reforms.

Trinidad was searching for available resources to supplement its maturing gas fields as production and exports of liquefied natural gas from Atlantic LNG gradually decline. One of Atlantic LNG trains at 15 million metric tons/year (mmty), the site is idle as of 2020 due to insufficient supply of feed gas.

The closure caused Export of LNG from Trinidad fell from 12.7 million tonnes (Mt) in 2019 to an all-time low of 6.3 Mt in 2021, according to Kpler data. Exports jumped slightly to 7.9 million tonnes last year as the European energy crisis shot up global prices for available volume LNG.

The Caribbean country is a global supplier of LNG and delivers several loads annually to New Englandespecially during periods of high winter demand. Only two countries in the region, Peru and Trinidadcurrently exports LNG.

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