Venezuela signs natural gas export deal with BP and Trinidad

Venezuela agreed on a 20-year natural gas production and exploration deal with BP Plc and Trinidad, a hotly anticipated move to transform the South American nation into a major exporter of the fuel.

The accord with BP and Trinidad’s National Gas Co. will allow for production from the Cocuina gas field off the Venezuelan coast, the country’s Oil Minister Pedro Tellechea said Wednesday in a statement.

According to Venezuela’s oil ministry, 25% of production will supply Trinidad’s petrochemical sector while the rest will feed the island’s LNG export industry. The field will produce an estimated 400 million cubic feet per day.

International oil companies have been gradually moving back into Venezuela in recent years. Years of US sanctions had severely curtailed foreign investment in the country, which has South America’s biggest reserves of oil and natural gas. Earlier this year, Spain’s Repsol SA obtained a license from the US to keep operating in Venezuela, Chevron Corp. restarted drilling for oil in the country and Indian refiner Reliance Industries Ltd. secured approval to resume importing oil from Venezuela.

The accord comes less than a week before Venezuelans head to the polls for the country’s presidential election.

BP’s deal for the field on Venezuela and Trinidad’s border follows talks announced early this year. BP has recently been more focused on expanding oil and gas production in familiar markets such as the Gulf of Mexico. A BP spokesperson declined to comment.

Prior studies show Venezuela’s Manakin and Cocuina fields have one trillion cubic feet of gas reserves.