By Mike Jarrett
The government of Trinidad and Tobago concluded negotiations with Venezuela in which the twin-island republic will gain access to the oil fields of their South American neighbour.
The deal was announced by Trinidad and Tobago’s Prime Minister, Dr. Keith Rowley, last summer at the same time he announced the closure of the Petrotrin refinery. Trinidad and Tobago is heavily dependent on the natural gas industry by way of the processing and export of natural gas or gas-based products such as methanol, fertilizer and other products.
“We opened discussions with Venezuela to get agreement on access to their large proven gas fields, just across our border. These reserves are economically and logistically more marketable from Trinidad than from Venezuela,” the Prime Minister explained in a public broadcast.
He said that over the past 15 years the Trinidad and Tobago national economy had become increasingly dependent on revenues from gas as against earnings from oil. He said the country’s gas reserves have been dwindling.
Success in this joint initiative, the Prime Minister said, would provide an extension of Trinidad and Tobago’s involvement in the gas business; while providing Venezuela with an opportunity to monetise some of its gas which otherwise would not get to market in any foreseeable time frame.
The agreement was signed on August 25, 2018 between Trinidad and Tobago’s National Gas Company (NGC), Shell and PDVSA.
The agreement clears the way for the construction of pipeline infrastructure to allow access to a Venezuelan gas field.
“This historic development, built on the time-honoured diplomatic principle of good neighbourliness for the benefit of both nations, established a competitive gas pricing mechanism which is sufficiently attractive to excite development of (Venezuela’s) Dragon field which is northwest of us, as well as on the south coast cross-border fields which we share with Venezuela. It gives us some potential to grow in the medium term and diversify our gas supply base even as it almost immediately adds to the pool of what is available for current needs,” the Prime Minister said.