Venezuelan Government Seals Natural Gas Agreement with Nigerian Business Entity
Title: Venezuela Secures New Gas Exploration Agreements with African Firm Veneoranto
August 11, 2024 - Yourhighfivingnews_
Venezuela's state oil company PDVSA has inked two fresh contracts with Nigerian firm Veneoranto, stepping up their collaboration in the exploration of offshore natural gas reserves. A grand ceremony happened last Thursday at the Miraflores Presidential Palace, where PDVSA's Minister Pedro Tellechea and Arthur Eze, the representative from Veneoranto, signed the agreements.
These deals focus on assessing the "technical-economic feasibility" of two fields: the Barracuda gas field, nestled in the Gulf of Venezuela's west, and the Boca de Serpiente field located on the Deltana Platform, Venezuela's eastward maritime border. The pair of fields is estimated to contain a whopping 30 trillion cubic feet (tcf) of natural gas, potentially catapulting Venezuela into the fourth spot among the planet's largest natural gas depositors. Presently, the country certifies approximately 200 tcf of gas.
In addition, the deals forge conditions for future gas exploration licenses. Venezuela's chief executive, Nicolás Maduro, applauded the new capital injections and encouraged more foreign partners to join forces with the nation's energy sector. "Venezuela gears up for mutual respect and fair juridical terms to sign win-win contracts with the private sector," he declared during a broadcast. The president underscored a bounty of opportunities open for international investors within the oil and gas sectors.
Maduro also expressed excitement about the accelerated growth in natural gas processes, anticipating eventual exports to Africa. Tellechea asserted that foreign investors exhibit faith in Venezuela, focusing on the nation, its industry, and the role they play in Venezuela's economic growth and stability.
Veneoranto is a recently formed subsidiary of Atlas Oranto Petroleum, a Nigerian multinational corporation helmed by Eze, among Africa's wealthiest business moguls. According to Atlas Oranto's LinkedIn profile, they run projects in 11 African countries.
Venezuela continues to entice private sector investment to resume an energy industry hobbled by US sanctions. Since 2017, the US Treasury Department has imposed financial sanctions, an export embargo, secondary sanctions, and numerous measures targeting Venezuela's oil revenues. In April, the US clamped down once again after a six-month reprieve that enabled PDVSA to freely export crude. Companies seeking to trade with Venezuela face US authorization, or else incur penalties through secondary sanctions. It remains unclear whether Atlas Oranto has secured clearance from the U.S. Treasury Department.
The Maduro administration has been especially enthusiastic about investment opportunities in its largely uncharted natural gas reserves. While oil ventures require PDVSA to maintain a majority stake, a loophole removes this condition when it comes to gaseous hydrocarbon projects, implying private enterprises can own the entire shares.
In recent months, PDVSA has struck offshore gas deals with neighbor Trinidad and Tobago. Last December, PDVSA issued a 30-year license for the Dragon field exploration project—jointly owned by Trinidad's National Gas Company (NGC) and Royal Dutch Shell. Shell owns a 70% stake and handles the project's operations. In July, PDVSA granted a 20-year permit for NGC and BP to explore the Cocuina-Manakin field, spanning between Venezuelan and Trinidadian waters. BP is reported to take 80% of shares, with Port of Spain and Caracas agreeing to a 66:34% split of the reserves.
Trinidad, Shell, and BP needed to secure US Treasury licenses to negotiate with the Maduro administration, as American officials exerted pressure to ensure Venezuela receives no cash from the deals. In both instances, PDVSA refrains from owning shares, with the Caribbean nation limited to taxes and royalties instead.
- The Barracuda and Boca de Serpiente gas fields in Venezuela, estimated to contain 30 tcf of natural gas, are the focus of new exploration agreements between PDVSA and Nigerian firm Veneoranto.
- According to Pedro Tellechea, Minister of PDVSA, foreign investors show faith in Venezuela and its energy sector, seeing opportunities for growth and stability.
- Arthur Eze, the representative from Veneoranto, signed the new agreements last Thursday at the Miraflores Presidential Palace, with PDVSA's Ministry present.
- In the deals, Venezuela and Veneoranto are to assess the technical-economic feasibility of the two fields, with potential implications for Venezuela's position among the world's largest natural gas depositors.
- Arianna News reports that Venezuela continues to encourage private investment in its energy sector, particularly within its uncharted natural gas reserves, as US sanctions hamper industry growth.
- PDVSA has recently forged deals with neighboring Trinidad and Tobago, granting exploration licenses for various gas fields to local companies, such as the National Gas Company (NGC), Royal Dutch Shell, and BP. In these arrangements, PDVSA refrains from owning shares, instead collecting taxes and royalties.
