Venezuela Urges BP, Chevron, and Shell to Revive Offshore Gas Project Amid Territorial Dispute

(Reuters) — Venezuela has begun contacting energy firms involved in a long-idled offshore gas project to push them to begin new exploration and operations near its maritime border with Guyana, five people close to the talks said.

The request to act on blocks that have not been touched in more than a decade comes amid an escalating territorial dispute with Guyana that has rattled the country and led to an emergency meeting of the United Nations Security Council.

Venezuelan President Nicolas Maduro wants state oil company PDVSA, and oil majors' BP, Chevron and Shell to revive an offshore project with some 8 trillion cubic feet of gas reserves.

Called Plataforma Deltana, the discoveries were never developed amid insufficient capital, an unfinished sharing effort with Trinidad and Tobago into whose waters the field extends, and a lack of clear rules for investment.

In 2019, both countries authorized Shell to develop Trinidad's portion of the largest reservoir, called Manatee, with a final investment decision expected next year and gas output to start in 2028.

Recently, Maduro has backtracked on that decision, telling Trinidad's government in public comments in September that the fields should be jointly developed. His government and PDVSA started tapping companies to weigh their interest.

Chevron was the only company that completed exploration in Plataforma Deltana, certifying 7.3 trillion cubic feet (TCF) of recoverable gas and declaring two of Venezuela's five blocks commercial in 2010. It never took steps to begin production.

Russia's Rosneft in recent years explored another block but did not complete work in the area, while TotalEnergies and Equinor returned one block to Venezuela after a non-commercial discovery. One of the five blocks was never awarded.

"They are talking about working at blocks 2 and 4, which are the most advanced ones," one of the sources said.

On Trinidad's side, those two blocks extend to Shell's Manatee project and to BP's Manakin shallow water block, both of which are moving to development and production design.

BP and Trinidad's government expect to begin negotiations with Venezuela to jointly produce gas at Manakin upon completion of discussions for Manatee, which have already started, according to another person familiar with the matter.

Chevron, two of the people said, has been in talks with Venezuela about its license.

Venezuela also made initial contact with Australia's Melbana Energy, which operates in Cuba. The discussions could lead to a seismic contract for the less explored blocks, one of the people said.

Venezuela's oil ministry, Trinidad's energy ministry, PDVSA and Melbana did not reply to requests for comment.

BP told Reuters it views the Manakin field as an important part of its future area development plan, even though it had been unable to progress work there.

"Since the temporary lifting of sanctions by the U.S. government, BP has been in early talks with the Trinidad and Tobago government assessing the opportunity to recommence development planning," the spokesperson said.

Chevron did not provide an immediate comment. Shell declined to comment.

Triple Interest

Plataforma Deltana is the closest energy project that Venezuela has to waters in dispute with Guyana. Both nations have drawn maritime border lines that cross offshore oil and gas areas in the other's claimed territory.

The north portion of the Stabroek block, a massive area in development by Exxon Mobil, CNOOC and Hess under license from Guyana, extends into Venezuelan waters, according to Maduro's government. One of Plataforma Deltana's blocks extends into Guyana's claimed waters.

Venezuela's oil ministry and PDVSA have worked since 2016 to outsource 2D seismic data collection and map areas including the Esequibo and the Isla de Aves territory in the Caribbean, which are in dispute with Guyana and Dominica, respectively, said Antero Alvarado, managing partner of consultancy Gas Energy Latin America.

"Venezuela has not completed seismic work in a very long time. The urgency of doing it now comes amid the dispute with Guyana and its renewed interest to export gas to markets like Trinidad," he said.

The territorial dispute with Guyana is being discussed at the International Court of Justice (ICJ), which this month ordered Venezuela to refrain from taking any action that would alter the situation with its neighbor. That came after Maduro's government held a vote on a referendum asking Venezuelans whether they accepted the ICJ's jurisdiction on the issue. They did not.

Maduro this week said he would authorize oil and mining exploration in the disputed areas with Guyana but did not elaborate on locations or projects. PDVSA and state industrial conglomerate CVG were asked to create specific divisions for that purpose.

Guyana's President Irfaan Ali this week said Maduro's actions were in blatant disregard of ICJ orders and an imminent threat to Guyana's territorial integrity.

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