Shell in Advanced Talks for Venezuelan Gas Expansion

SHELL PLC is in advanced negotiations with the government of Venezuela to develop four major offshore natural gas areas located near Trinidad and Tobago. The United Kingdom-based energy major is seeking to expand its presence in the region by targeting fields within the 12-trillion-cubic-feet Mariscal Sucre project. This expansion includes the Dragon field, where a final investment decision could be reached by the end of this year, alongside neighboring areas that would significantly increase the company's regional reserves of Natural Gas. The negotiations also cover the 7.3-tcf Loran offshore area, a cross-border field that extends into Trinidadian waters. Combined with the Mariscal Sucre fields, the total reserves under discussion reach approximately 20 tcf. Shell intends to transport the Venezuelan gas to Trinidad for processing at the Atlantic LNG facility, which has been operating below its 15.5 million metric tons per annum capacity due to insufficient supply. While the United States company CHEVRON CORP currently holds interests in the Loran field on the Venezuelan side, it is expected to relinquish these stakes to focus on oil projects in the Orinoco Belt. > "The proximity to Manatee makes Loran an attractive investment opportunity for Shell." Shell Chief Executive Wael Sawan noted during the CERAWeek conference that the company is looking for ways to add value to the Venezuelan energy sector, particularly through gas monetization. > "Initially, I would say its more geared towards gas, and in particular gas that can be monetized through LNG." A potential obstacle to the agreement is the historical involvement of Russia in the region. ROSNEFT OIL CO PJSC was previously granted interests in the Patao and Mejillones fields, which are now held by another Russian state-owned entity. > "We are making progress, and yes, the assignment of the fields to the Russian company is a problem, but we will get over it."