Price - the sticking point for Dragon deal

PRICE is the sticking point, as TT and Venezuela finalise the details on the long-awaited Dragon gas deal between the two countries. “We’ve narrowed a lot down – things like governing law principle, infrastructure, and measurement. Right now we’re just stuck on price,” Young told reporters yesterday at the post-Cabinet media briefing. Young, who leads the TT negotiations, travelled to Caracas yesterday to meet with Venezuela’s Energy Minister and president of its state oil company, PdVSA, Manuel Quevedo, and is expected to return to Venezuela on July 16—by which time, he said, he hoped the deal would be settled.

It’s been two years since this deal was first announced, with first gas estimated by 2020; that timeline is still on track, it appears, as Young gave reporters a timeline of 18 months to two years to get first gas here—providing the deal is signed soon.

A special purpose vehicle between multinational energy giant Shell and the National Gas Company (NGC) has been created to lay down the infrastructure; Shell’s pipelines, including those in the North Coast Marine Acreage will be used to transport Dragon’s gas to the Hibiscus platform off the north-west coast of Trinidad and only 18 kilometres away from the gas field. Hibiscus is jointly owned by the TT government and Shell. Young said the first tranche of Dragon’s production will yield about 150 million standard cubic feet of gas per day (mmscfd), or 26,505 barrel of oil equivalent per day (boed). For comparison, Petrotrin produces 43,000 barrels of oil per day and 130 mmscfd; bpTT’s Juniper well, which came on stream in the latter half of 2017, produces about 590 mmscfd.

Young acknowledged that this production from Dragon was not a lot, but said if the country could get that much gas to Point Lisas right now, it would be a lot, in reference to sustained curtailments in supply to the Industrial Complex there. “You must understand this is a field where they have done exploration and have not produced; there are some wells that have some gas and they want to start (producing). I keep saying once that gas starts to flow the whole dynamic will change,” Young said.