TT-Ven
cross-border agreement: No decision yet on use of
unitised gas
TG
By
Curtis Williams and Sherwin Long
The
Trinidad Guardian
Port
Spain
Petroleumworld.com
07 30 06
With
last week’s announcement that T&T and
Venezuela are close to reaching a unitisation agreement
on the Loran/Manatee field, there is still no clear
decision on whether Venezuela will allow some of
its gas to be liquefied in T&T.
The
Patrick Manning administration has been open in
its desire to use some of Venezuela’s gas
to buttress T&T’s position as the leading
LNG exporter in the western hemisphere.
However,
T&T’s ambassador to Venezuela Sheelagh
De Osuna said Caracas has not sent any signals that
it would will be willing to have some of its gas
used here.
She
said, “I have not seen it written anywhere,
nor have I heard from any official anything to suggest
that Venezuela’s gas will be used anywhere
else except in Venezuela.”
Venezuelan
president Hugo Chavez said he had no objection to
gas from the Kapok/Dorado field being used in this
country for a specific period since there was already
infrastructure in place in T&T. At stake is
ten trillion cubic feet (tcf) of gas in two of the
three blocks that it is believed are shared by the
two countries.
De
Osuna said the announcement of the imminent conclusion
of an agreement showed there was political will
on both sides to come to an agreement.
The
technical working group has completed its work and
sources in Venezuela said the Loran/Manatee field
has five tcf of gas with the distribution being
73 per cent on the Venezuela side and 27 per cent
on the Trinidad side.
De
Osuna refused to confirm the figure and would only
say it was close to the 70:30 per cent ratio always
believed.
She
indicated that the Loran/Manatee field will be the
first one unitised but that will be closely followed
by the Kapok/Dorado field in which 3.5 of the five
tcf of gas (70 per cent) is believed to be on the
T&T side.
De
Osuna said at the moment it appeared that Port-of-Spain
will take its 27 percentage of the gas from Loran/Manatee
field while Venezuela will take 73 per cent from
the same field.
Her
question was: what would happen if T&T is ready
to produce and Venezuela is not.
At
the moment the two sides are finalising issues of
taxation and methods of production before coming
to a final arrangement.
Venezuela’s
national oil company Pdvsa and bpTT recently exchanged
data on the fields and when that working group is
finished then a unitisation agreement will be pursued.
She
said these talks were in there final stages.
PetroCaribe
not an issue
Last
year, Venezuela offered Caricom countries “deferred-payment”
oil under its PetroCaribe initiative.
The
move was thought to have cast a shadow of doubt
over the unitisation talks.
However,
with T&T’s announcement that it was not
going to try and block the PetroCaribe agreement,
there appeared to be a rapprochement from Caracas
with President Hugo Chavez publicly admitting that
there should have been more consultation prior to
the signing of the PetroCaribe agreement.
Since
then there has been a greater push towards finalising
an agreement.
But
De Osuna was adamant that PetroCaribe played no
part in the unitisation talks as these discussions
preceded PetroCaribe.
While
the Government may have looked past the PetroCaribe
issue, they surely have not looked past their drive
to go further downstream.
The
Government has considered developing several downstream
projects such as two aluminium smelters, a maleic
anhydride derivative complex and an ethane-based
polyethylene complex.
Prime
Minister Manning went on the record to say he expected
future LNG trains to use Venezuelan gas.The need
to add to the country’s proven gas reserves
plus the current industrial thrust was not lost
on De Osuna.
“Patrick
Manning has always said he hoped gas from the Platforma
Deltana would be available to us for the country’s
development,” she said. “But we can’t
exploit them until we have a treaty.”
BGTT claim
Aleem
Hosein, BGTT head of government and public affairs,
said they were not lobbying the Government to push
for unitisation with Venezuela.
“The
gas in our 6d block will be booked in our reserves
but as far as development goes we will have to wait
until the agreement,” Hosein said.
“It
is not hampering our plans for the area as it takes
usually four to five years to develop (an area)
after you explore and find reserves.”
Hosein
added that BGTT expected the agreement to be hammered
out in time for their development of block 6d.
“We
just have to bid our time but we believe (unitisation
talks) will be favourable,” he said.
The
field of dreams
The
two fields in question are the Loran/Manatee field
and the Kapok/Dorado field.
The
Kapok field straddles block 1 on the Venezuela side
and T&T has argued that natural gas from block
1 should be processed in this country because of
the extensive infrastructure already in place on
the T&T side of the border.
Kapok
has in excess of 3.5 trillion cubic feet (tcf) of
gas while it is believed that block 1 contains an
additional 1.5 tcf.
BpTT
is already producing gas from Kapok which is being
processed at Atlantic LNG’s Point Fortin plant.
In
spite of this, De Osuna said, from T&T’s
point of view, the Kapok/Dorado field was less significant
because it was predominantly on Venezuela’s
side of the border.
BGTT/ChevronTexaco’s
6d acreage and ChevronTexaco/ Conoco Phillips’
block 2 over the border in Venezuelan waters and
bpTT’s Kapok field and block 1 in Venezuela.
The Trinidad Guardian
Thursday 27th July 2006
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©2006 Trinidad Guardian. All Rights Reserved.
