Reuters has reported that Shell is in advanced negotiations with the Venezuelan government to expand its footprint in the country, targeting four major natural gas areas near the maritime border with Trinidad and Tobago.
Shell has spent several years attempting to kickstart the 4.2-trillion-cubic-feet (tcf) Dragon field and is now looking to consolidate a massive production hub. The proposed expansion would include three additional fields within the Mariscal Sucre project and the 7.3-tcf Loran offshore area. If successful, the move would give Shell access to combined reserves totalling approximately 20 tcf.
Reuters indicates that a final investment decision on Dragon could come as early as year-end. Shell Chief Executive Wael Sawan previously indicated that the company could greenlight up to two Venezuela projects this year if fiscal and legal conditions improve. He made this comment at the recently concluded CERAWeek.
"What we are looking at the moment is where we can add value to Venezuela," Sawan said. "Initially, I would say it's more geared towards gas, and in particular gas that can be monetized through LNG."
According to Reuters, Shell plans to transport Venezuelan gas to Trinidad and Tobago for processing at the Atlantic facility. Shell currently holds a 45% stake in the Atlantic LNG project in Trinidad.
The Energy Chamber acknowledges the significant potential of bringing additional natural gas into the country. With substantial spare capacity currently available at Atlantic LNG, increased LNG production would boost national exports and generate much needed foreign exchange. Furthermore, moving these projects into the implementation stage would create valuable opportunities for the local supply chain and provide work for local contractors.