Exclusive: U.S. issues license to Trinidad and Tobago to develop Venezuela offshore gas field

WASHINGTON/PORT OF SPAIN, Jan 24 (Reuters) – The Biden administration has granted a permit to Trinidad and Tobago to build a gas refinery in Venezuelan territory, U.S. and Trinidadian officials said on Tuesday, while also easing some sanctions. in Venezuela.

The license, granted by the US Department of the Treasury at the request of Trinidad and aimed at strengthening energy security in the Caribbean region, means that the island nation can do business related to the Dragon gas field with the Venezuelan oil company, which is widely recognized. of PDVSA.

Prime Minister Keith Rowley, speaking at a press conference in Port of Spain, said Trinidad hopes to get access to 350 million cubic feet of gas from the Dragon field.

He said he applied for the license in 2022 and received approval after consulting with US officials, including US President Joe Biden, and maintaining communication with Venezuelan President Nicolas Maduro.

A US official, speaking to Reuters on condition of anonymity, said that “the Maduro regime will not be allowed to receive any money from this project” and that all remaining US sanctions are irreversible and remain in effect.

Also Read :  Germany edges past UK as Europe's leading market for NFL

“This decision is the result of many discussions between the Vice President Kamala Harris and the leaders of the Caribbean, who clearly said that granting this authorization would help to ensure their security and reduce the dependence of the region’s power on other countries, including Russia,” he said. said the officer.

PDVSA has discovered reserves of 4.2 trillion cubic feet (TCF) in the Dragon field, on the Venezuelan side of its maritime border with Trinidad. The project was planned ten years ago, but was put on hold due to lack of funding and partners, as well as sanctions.

Under the US sanctions, companies and governments must obtain permission from the US Treasury Department to do business with PDVSA. The Biden administration has issued only a handful of licenses since taking office in January 2021, mostly without restrictions.

The license issue follows talks in November between Maduro’s socialist government and the opposition, which are aimed at finding a way to hold new elections. But Maduro, whose 2018 election was widely criticized by Western governments as a sham, has refused to send his negotiating team to the table since then.

Also Read :  Davos 2023: Recession casts long shadow over opening of WEF summit

With Maduro’s hand bolstered by a crackdown on the opposition and a weakening of Latin American separatism, it was unclear whether the new U.S. concession would help him start negotiations with Mexico.

REGIONAL POWER REQUIREMENTS FOR USE

One of Washington’s main goals appears to be a response to US partners in the Caribbean who have asked for help to deal with rising energy prices following Russia’s invasion of Ukraine last year.

“The Vice President conveyed to the Prime Minister that the Treasury Department will take action to meet the long-term needs of the region,” Harris’ office said, referring to a phone call with Rowley on Tuesday.

The license allows PDVSA, Shell ( SHEL.L ) and Trinidad to jointly plan and develop a gas export project, Rowley said, adding that details would be finalized in the coming days. The next part of the gas should be sent to Jamaica and the Dominican Republic, according to the two-year license, he said.

Trinidad is Latin America’s largest natural gas (LNG) exporter, with a capacity to produce 4.2 billion cubic feet per day (bcfd) of LNG, petrochemicals and energy. But its natural gas production is below 3 bcfd.

Also Read :  New Zealand counts cost of Auckland floods, more rain forecast

Even if Washington grants Trinidad’s request, it could take years of investment and development to bring Venezuelan gas to Trinidad and boost LNG exports, experts say.

In addition, without the remittances allowed in Venezuela, it would be difficult for Trinidad to form an agreement with Caracas.

Funded PDVSA is expected to run the Dragon project on the Venezuelan side. The US permit could open the door to moving forward with another gas project with Trinidad, in the Loran-Manatee fields.

In November the United States granted a six-month license to Chevron ( CVX.N ), allowing it to expand operations in Venezuela and bring oil to the United States.

The Chevron permit was one of Washington’s first moves to ease sanctions as it encouraged Caracas to work with opposition leaders.

Reporting by Matt Spetalnick in Washington, Marianna Parraga in Houston and Curtis Williams in Port of Spain, Editing by Rosalba O’Brien

Our Standards: Thomson Reuters Trust Principles.

Source

Leave a Reply

Your email address will not be published.

Related Articles

Back to top button