Curtis Williams
HOUSTON (Reuters) – Trinidad and Tobago has received six bids from BP (NYSE:), Shell (LON:) and U.S. shale company EOG Resources (NYSE:) for four oil and gas exploration blocks after a shallow water auction closes in 2023. Monday.
Trinidad plans to announce the winners in four months, Energy Minister Stuart Young said at the close of the auction.
All three companies are vying for the Modified UC block, located near the Thik, Sammaan and Pui producing fields. There were no other participants at the auction.
Trinidad is the largest producer of liquefied natural gas (LNG) in Latin America, with an installed capacity of 15 million metric tons of super-cooled gas per year. It is also one of the world’s largest exporters of methanol and ammonia, but its plants have not been running at full capacity in recent years due to gas shortages.
In October 2023, the Trinidad government put 13 blocks up for auction. Monday’s results mean nine of the 13 blocks received no interest, with all bids coming from companies already operating on the Caribbean island.
EOG Resources has applied for three blocks: Modified UC; Lower Reverse L, which is west of Shell’s manatee field and borders neighboring Venezuela; and NCMA 4 in Shell-controlled territory.
Shell has made one bid for Modified UC, while BP, which has made a bid for Modified UC, has also placed a bid for NCMA 2, which is north of Trinidad and not in the Columbus Basin where the company has operated since the 1970s.
Trinidad has made several changes to financial terms to attract more bids after a failed bidding round in 2019, including reducing tax liability for small-scale producers, increasing cost recovery from 50% to 60%, reducing windfall tax from 50% to 50%. 70%, increasing the exploration period from six years to eight years and reducing the tender fee to US$30,000 from US$40,000.