Chevron has agreed to sell its Trinidad and Tobago assets to Royal Dutch Shell in a deal worth approximately US$250 million.
The deal is due to close in June and includes the company's 50% stake in Blocks E, 5(a) and 6, all of which are currently operated by Shell and located in the East Coast Marine Area. The agreement also includes Chevron's stake in the Manatee gas field and the company’s 50% interest in Trinling, a gas transportation company which ships LNG worldwide.
Manatee is part of the Loran-Manatee project, a gas play that straddles Trinidad and Tobago and Venezuela’s maritime border with separate licences to develop the reserve on both sides of the border.
Chevron said that the deal would not have "any impact on the Loran-Manatee project" and that "the governments of Trinidad and Tobago, Venezuela, and the partners: PDVSA, Chevron and Shell remain committed to progressing the development of this important project". Chevron confirmed that it "will continue as operator of the Loran-Manatee unit" and that it will retain its stake in the Loran field on the Venezuelan side.
The Dolphin, Dolphin Deep and Starfish gas fields in the East Coast Marine Area are all included as part of the deal. Production at the three fields averaged 74 mmcf (2 mcm) per day in 2016. Texaco originally owned the fields with production beginning at Dolphin in 1993. Texaco then merged with Chevron in 2001 and Dolphin Deep and Starfish started production in 2006 and 2014, respectively.
Derek Hudson, Shell’s vice president for Trinidad and Tobago, said that, in addition to optimising the company’s assets in the twin-island state, it will also "pursue additional opportunities such as the previously announced purchase of Centrica’s interests in the North Coast Marine Area".
The country’s Energy Minister said that the agreement was a "welcome and expected consolidation" of Shell’s position in the country.
Shell said that the addition to its Trinidad and Tobago portfolio will help it "optimise" its production in the East Coast Marine Area, which it describes as a "core component" of its interests in the twin-island state.
Hudson added: "Trinidad and Tobago represents a rich opportunity for us to continue building our integrated gas position in the country and [in] securing new competitive production."
Centrica sold its entire portfolio in Trinidad and Tobago to Shell last November for US$30 million. The sale included its 17.4% stake in the North Coast Marine Area, which is located north of the island of Trinidad, and 80% and 90% interests in NCMA-4 and Block 22, respectively. Centrica will receive extra payments for the underdeveloped NCMA-4 and Block 22 when the projects have reached certain milestones.
Shell also acquired all of Repsol’s LNG interests in the Caribbean country in 2013 as part of a US$6.7 billion divestment which also included assets in Peru and Spain as well.