Chavez, Manning sign cross-border gas treaty

Trinidad and Tobago has signed a cross-border treaty with Venezuela, following an agreement concluded earlier this month to jointly develop an estimated 30 tcf of natural gas in offshore fields straddling the borders of the two nations (OGJ, Mar. 12, 2007, Newsletter).

Mar 26th, 2007

Curtis Williams
OGJ Correspondent

PORT OF SPAIN, Mar. 26 -- Trinidad and Tobago has signed a cross-border treaty with Venezuela, following an agreement concluded earlier this month to jointly develop an estimated 30 tcf of natural gas in offshore fields straddling the borders of the two nations (OGJ, Mar. 12, 2007, Newsletter). It is the first such agreement in the Western Hemisphere and is designed to provide for the production of gas out of the Deltana area.

Venezuela President Hugo Chavez and Trinidad and Tobago Prime Minister Patrick Manning, who signed the agreement in Caracas, hailed the treaty as a major step forward, allowing the countries to develop one of the world's most prolific gas regions.

The first fields to be developed will be Loran and Manatee, which are estimated to hold 10 tcf of gas—7.3 tcf on the Venezuelan side and 2.7 tcf on the Trinidad and Tobago side. Chevron Corp. operates Loran and is a partner with BG Group on the Trinidad side (Manatee), which BG Group operates.

The treaty sets the framework for taxation and other production issues. However markets for the gas have yet to be determined.

The two countries will decide by mid-April where Loran-Manatee gas will be piped for processing. Manning wants it processed as LNG in the Caribbean island nation, where it would form the basis for an additional LNG train.

"We are a producer of LNG at this time and can do it much quicker than in any other route." Manning explained. The country is conducting talks with BG about adding another LNG train at Point Fortin (OGJ Online, Mar. 23, 2007).

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