Shell, bp, EOG combine for six shallow-water exploration bids

The content originally appeared on: Trinidad and Tobago Newsday

Shell TT office. –

SIX bids were made on five shallow-water blocks during the closing ceremony of the shallow water competitive bid round 2023, held at Tower C of the Waterfront Complex, Port of Spain.

The bids were made on total of 13 blocks which were available for bidding by oil and gas companies for exploration from October 3. EOG, Shell and bp Exploration were the companies that did the bidding.

All three companies bid on Block U (c) located in the waters off the eastern shore of Trinidad with Shell bidding through BG International Ltd. Bp Exploration also bid on NCMA 2 in the waters west of Tobago.

EOG also bid on the NCMA 4 (a) block in Tobago waters and Lower Reverse L, located southeast of Trinidad.

Minister of Energy Stuart Young in his closing remarks said the bids were not surprising, describing it as a continuation of TT’s three major oil and gas exploration and production companies’ relationship with TT.

“From our perspective as the government of TT, this augers well,” he said.

“When you look at the blocks that have been bid on and hopefully they will be successful in the next four months, they were all near to existing infrastructure and blocks that are currently under production. And I am certain that when you do further analysis that there is a synergy that continues.”

Young added that another deepwater bid round is expected to be opened before the end of this year.

After the announcement of the bids, David Campbell, president of bpTT said the bid round was a successful one.

“It is good to see this level of interest in what is a relatively mature area. We remain as a company very committed to TT,” he said.

Campbell added that proximity to already-established infrastructure was a key factor in bpTT’s considerations for the blocks on which they bid.

“(It) is important, to the overall economics to use the existing investments we’ve made in the past that have fully depreciated; and that is an advantage that mature areas have,” he said.

He added that production sharing contracts, under which the blocks are to be governed, were also vital to ensuring that all parties benefit from exploration and production.

“It’s the same all over the world – we work with tax and royalty regimes, we work in production-sharing contracts. We have to look at every one on its merit, but it s always a sharing between government and company and of course the supply chain as well.”

The latest shallow-water bid round commenced from October 3 to May 27. Successful bids will be announced in four months.

The last shallow-water bid round, held in 2019, resulted in three bids out of six blocks offered. The latest shallow-water bid round was the third in a series of bid rounds.

Young, in his remarks at the closing ceremony, said bidders would be evaluated on a point system which would be conducted by a technical evaluation team, comprising of senior officials of the Ministry of Energy and Energy Industries, the Ministry of Finance and the Office of the Attorney general.

Young said, an audit of non-associated natural gas resources indicated that, at the end of 2022, proven reserve technically recoverable resources amounted to 11.5 tcf and prospective resources on an unrisked basis amounted to 56.9 tcf.

“The bid rounds are aimed at exploring, developing and monetising the country’s hydrocarbon resources. It is our intention to offer new acreage in a timely and continuous manner.”