Government sources confirm that Trinidad and ExxonMobil have agreed to terms on deepwater blocks.
Two senior government officials confirmed that Trinidad and Tobago has awarded ExxonMobil, the U.S. oil giant, acreage to explore for oil and natural gas in an ultra-deep area.
Negotiations began earlier this year between the parties for the area off the coast of the Caribbean nation that ExxonMobil abandoned more than 20-years ago. The blocks are northwest of ExxonMobil’s Stabroek Block in Guyana where its consortium has confirmed that more than 11 billion bbls of recoverable resource can be recovered.
According to people familiar with the negotiations who are not authorized to speak in public, ExxonMobil could sign an agreement with the Trinidadian Government as early as next week.
ExxonMobil will receive a combined area of seven blocks renamed Ultra Deep 1 (UD1) People told us that the area covered water depths between 2,000 and 3,000 meters.
ExxonMobil's spokesperson said: "We won't comment on third-party sources, but we regularly look for opportunities to optimize our portfolio."
Trinidad and Tobago's Energy Minister Roodal moonilal has not responded to a comment request.
TGS, a Houston-based firm that analyzes energy data, found in a study for 2024 that "Ultra deep Trinidad and Tobago" could unlock potential comparable to ExxonMobil’s Stabroek Block.
ExxonMobil, Chevron, and CNOOC, partners in Guyana, are about to start production at their fourth floating plant, which will increase its capacity above 900,000. barrels per daily (bpd), a little more than six years since the country began oil production. The group aims to reach a production of 1.7 million barrels per day (bpd) by 2030.
During the a
Press briefing
ExxonMobil's CEO Darren Woods stated last week that exploration is a part of a 3-pronged strategy to ensure the company continues to replace the oil and natural gas it produces.
"We continue to make a consistent and focused effort in finding resources that are economically advantageous and competitive for our portfolio." Woods said.
Work to Do
The two sources confirmed that ExxonMobil had agreed to a sign-up bonus as well as a three phase exploration program for Trinidad, which includes acquisition of seismic data and the drilling of exploration holes.
The sources stated that if oil or gas are found, there will also be royalty payments, a portion of profits going to the government and provisions for cost recovery.
ExxonMobil approached the Trinidadian Government in November 2024 to express interest in the seven blocks.
Trinidad and Tobago has a deepwater sale that will close on the 17th of September. ExxonMobil's interest is not included in this auction.
Trinidad's law allows the government to negotiate individual areas for exploration or production, if those areas are not included in an open bidding process.
Trinidad is trying to revive investment, particularly offshore, where it needs more gas to support its liquefied gas and petrochemical industry. It is also looking for oil in the deep seas.
The U.S. has recently withdrawn its approval for a major offshore gas project in Venezuela. The project was supposed to relieve the country of its ongoing gas shortages.
(source: Reuters)
