June 13, 2024
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OIL & GAS

BP, NGC Receive U.S. License to Develop Gas Fields with Venezuela

British oil giant BP and Trinidad and Tobago’s state energy firm NGC have secured a two-year license from the U.S. Treasury Department to collaborate on the Cocuina-Manakin gas fields with Venezuela.

This announcement was made by Trinidad’s energy minister, Stuart Young, on Wednesday.

Despite Washington’s recent decision not to renew a broad license allowing Venezuela to freely export its oil and receive investment, it has granted individual authorizations to companies interested in doing business in the sanctioned South American country.

BP and NGC are now authorized to plan a project for an offshore reservoir that spans Venezuela and Trinidad, containing approximately 1 trillion cubic feet (tcf) of gas reserves.

This authorization follows a similar license issued to Shell and NGC in 2023 for the Dragon gas field in Venezuela, with the project exporting gas to Trinidad under a license extended through October 2025.

Minister Young emphasized, “It’s the same terms as Dragon, where we can pay in U.S. currency,” referring to the new license which allows transactions in hard currency, providing an exemption to U.S. sanctions on Venezuela.

BP had previously paused negotiations for the Cocuina-Manakin project, awaiting U.S. authorization, which has now been granted. The company has yet to respond to requests for comment on the recent development.

In addition to BP and NGC, other companies like France’s Maurel & Prom, Spain’s Repsol, and the Caribbean island of Aruba have also received U.S. licenses to engage in business with Venezuela. Aruba’s authorization permits the import of Venezuelan fuel oil for domestic use.

Venezuela aims to commence gas exports to generate additional revenue, while Trinidad needs the gas to supply its petrochemical and liquefied natural gas plants, given the decline in its own production.

A third joint project involving the Loran-Manatee fields, which hold around 10 tcf of gas, is also anticipated by both countries.

Minister Young revealed ongoing discussions with Venezuelan President Nicolas Maduro about the Loran-Manatee project, emphasizing a strategic approach, “one by one.”

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