Minister of Energy and Energy Industries Stuart Young –
The US Office of Foreign Assets Control (OFAC) has granted Trinidad and Tobago permission to pay Venezuela for gas from the Dragon gas field in US dollars, Venezuelan bolivares, fiat currency and humanitarian aid.
The licence allowing TT trade with Venezuela has also been extended to October 31, 2025.
Minister of Energy and Energy Industries Stuart Young made the announcement at a media conference on Tuesday at the International Waterfront Centre, Port of Spain.
“I am pleased to announce that today (Tuesday), the US government has issued, through the treasury department OFAC, to the government of TT, an amendment to the licence that we had requested in the terms that we have requested.
“The licence will now run for two years until October 31, 2025, which is more than enough time for us to get done what needs to get done.
“It also allows TT, working along with NGC and Shell, to negotiate, and complete negotiations and all agreements with the Venezuelan government and PDVSA for the development, production and export of that gas from the Dragon gas field in TT for us to develop it, and for us to make payments in fiat currency, as well as US dollars, as well as Bolivar, as well as via humanitarian measures, which is what was envisaged initially.”
Young said there are no restrictions on the amount of US dollars which could be used to pay Venezuela.
He noted that the agreement signed with Venezuela in September, in addition to continued negotiations for the development of the Dragon field, also permitted continued discussions with the Venezuelan government for other gas fields and other gas developments.
“It also got down to granular level detail with respect to the allocation of gas and for all of the gas from Dragon to come to TT and the allocation of that gas both to our domestic petrochemical sector as well as the LNG sector, for Shell to continue to be our operator and our partner in these arrangements.”
Young said the OFAC licence is now a full green light for the government to do what needs to be done.
He said there have been several virtual meetings with the Venezuelan government and PDVSA “as we now get into the granular level of detail for the pricing of the development of the gas from Dragon.
“Very shortly, I will lead a team back to Venezuela, where I hope for us to finalise those arrangements.
“Not only are we negotiating the commercial terms, the pricing of the gas in Venezuela, the allocation and the other things associated with the commercial terms, we are also negotiating the technical terms, working out with the engineers, particularly those at Shell, how quickly we can develop the Dragon gas field to bring this gas to TT.”
He confirmed that Shell will operate the Dragon field and that gas will be brought to the existing Hibiscus platform for onward transmission to plants in Trinidad.
Young said if all green lights were in place, production could be done in less than two years.
He said the PM, who had left the country for Canada early Tuesday morning, had been apprised of the development.
“We have remained engaged with him, discussing it with him from 6 am today.
“Word came to me today sometime just before noon from the US government and then via our lawyers in Washington, DC. Immediately the PM was told of this great and significant development, and we have been discussing and strategising the next moves going forward.”
Young noted that the OFAC licence granted to TT was only the second such licence granted for trade with Venezuela and for the longest period, with the other being a three-month licence granted to oil company Chevron.
The original OFAC licence to TT was granted in January 2023.
Both the PM and Young have been part of negotiations with the US and Venezuelan governments since 2022.
Asked about whether the removal of US sanctions on Venezuela has been discussed, Young said, “I have had many conversations with the US government at the highest level, as well as my Venezuelan counterparts, at all stages. We have continued to encourage dialogue and at all stages, I can say and report – including on the last occasion I was in Venezuela having those meetings and conversations – we encouraged dialogue and held out that TT remains available to assist in such conversations, we can be a meeting place, these kinds of things.“We are always well received by President Maduro and his government as well as the US government at the highest levels.”
The TT Energy Chamber, in a release on Tuesday, warmly welcomed the announcement. It said this was a significant development for the energy industry in TT.
“The announcement represents an important further milestone in the plans to import natural gas from Venezuela for use in our well-developed existing downstream gas industry and LNG export facilities.“This natural gas will help return the mid and downstream infrastructure in Trinidad to capacity utilisation and will provide the world with a much-needed secure source of LNG and petrochemicals, such as methanol and ammonia.”
The Chamber commended the government and its partners, NGC and Shell, in progressing this important project and said it looked forward to further updates as the commercial and technical agreements are finalised.
These OFAC concessions may not have come out of the blue.
The US government had previously said it would consider easing restrictions on Venezuela if Madura allowed free and fair elections.
The Associated Press (AP) reported on Tuesday that Venezuela’s government and a faction of its opposition agreed formally to work together to “reach a series of basic conditions for the next presidential election, including scheduling the contest for the second half of 2024.
“Their accord was part of agreements that are expected to trigger partial relief from economic sanctions imposed by the US government on President Nicolás Maduro’s administration,” AP reported.
The Washington Post, in an article on Tuesday, said leaders from the government and the opposition formalised the deal in Barbados during an event facilitated by the Norwegian government with US representatives present.
It said Maduro had pledged to allow all parties to choose their candidates, allow missions from the EU and UN to observe the vote, and grant all campaigns fair access to the media.