By OGJ editors
HOUSTON, June 19 -- Partners of a planned $2.5-3 billion Venezuelan LNG export scheme—newly dubbed the Mariscal Sucre LNG project—are making advances toward development phases for a project that would tap as much as 10 tcf of natural gas from the Norte de Paria fields off Venezuela's northeastern coast in the Caribbean Sea. The project would also entail the construction of a 4.7 million tonne/year LNG terminal in the port town of Guiria on the Paria peninsula. Construction is slated to begin in 2005, with exports expected to start in 2007. Markets would include other areas of the Caribbean and along the US East Coast.
Venezuela's Ministry of Energy and Mines, state firm Petroleos de Venezuela SA, Royal Dutch/Shell unit Shell Gas & Power, and Japan's Mitsubishi Corp. signed a framework agreement last week outlining the development of such a project, which was formerly known as Project Venezuela Liquefied Natural Gas (PVLNG). PVLNG itself was a downscaled version of the so-called Cristobal Colon LNG export project proposed by the same partners in addition to Exxon Corp. before its merger with Mobil Corp. (OGJ, Apr. 3, 2000, p. 32). Earlier this year, ExxonMobil Corp. was beaten out by Shell for a stake in the project, according to Venezuelan press reports.
Venezuela has been considering such an LNG export scheme for more than 10 years, but has run into obstacles surrounding partnership interests and the overall economics of the project.
Shell will hold 30% stake in the project, Mitsubishi 8%, and PDVSA will retain a 60% stake. The remaining 2% will be offered on the local stock exchange. According to recent press reports, a portion of PDVSA's stake could be awarded to Qatar, which has expressed some interest in participating in the project.
In the coming months, the partners expect to finalize a project development agreement for the project. This step will be followed by the signing of a joint venture agreement (JVA) sometime in 2003. Prior to the signing of the JVA, engineering and other studies will be carried out in order to reconfirm the viability of the project, the partners said.
