Venezuela Is a Reliable Alternative in the Global Gas Market

Specialized energy publications indicate that Venezuela has all the conditions to become a significant provider of natural gas to international markets.

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On Dec. 21, 2023, this South American country granted a license to the National Gas Company of Trinidad & Tobago (NGC) and Shell for the exploration and exploitation of non-associated gas in the Dragon field, which has over 4 trillion cubic feet in gas reserves.

While the first drilling in this field occurred in 2008, Venezuela and Trinidad & Tobago signed their first commercial agreement to produce and export gas in 2018. However, a year later, U.S. sanctions against PDVSA caused a halt to the project.

In October 2023, however, the United States Department of the Treasury partially suspended some sanctions against PDVSA, allowing the Dragon field to regain strength as an international energy project.

Natural gas has gained significant ground in the distribution of the world's consumption map. Geopolitical events have doubled the interest in ensuring a secure and efficient supply of gas. This is where the Dragon field and Trinidad & Tobago come into play.

With top-notch facilities in Liquefied Natural Gas (LNG), the Caribbean country is the third-largest exporter of natural gas in the region, with five main destinations: the United States, China, Canada, Spain, and Lithuania.

Globally, natural gas consumption is on the rise, and there is a widespread consensus on the need to diversify supply sources. The countries of the Organization for Economic Cooperation and Development (OECD) continue to concentrate the largest share of global natural gas consumption.

"There is great European interest in what is happening in Trinidad & Tobago in its attempt to introduce resources from South America into the market," said Trinidad & Tobago Prime Minister Keith Rowley, referring to the revitalization of the Dragon field.

Europe's interest is linked to the internal tension within the bloc for rapid and secure diversification. The European gas import matrix shows a relationship of distribution dependence between a few actors after sanctions against Russia paralyzed gas trade.

Currently, Europe imports gas mainly from the United States, Qatar, Algeria, and Norway, but imports from Russia still persist, accounting for 24.65 percent of the total. The need to further decentralize supply sources remains a top priority for the European Union.

Despite improvements in gas storage, the European Union remains exposed to a strategic vulnerability scenario due to multiple factors. The stability of the LNG market is highly susceptible to changes in demand in high-growth regions like Asia, intense competition, and the impacts of international tension on prices.

In this context, the Dragon field stands out as a reliable, optimal, and secure alternative, with the potential to positively impact a dynamic of stabilization and assurance of supplies.