Shell signs oil and gas, exploration agreements with Venezuela

Oil major Shell SHEL.L inked several oil agreements with the Venezuelan government on Thursday that span offshore natural gas and onshore oil and gas opportunities, the company said in a statement.

It also signed several technical and commercial agreements with Venezuelan engineering company VEPICA, as well as with KBR and U.S. oil services firm Baker Hughes BKR.O.

The agreements follow U.S. Interior Secretary Doug Burgum's meeting with Venezuelan President Delcy Rodriguez in the South American country this week.

Burgum is the second cabinet secretary to visit Venezuela since a U.S. raidin January captured President Nicolas Maduro. U.S. Energy Secretary Chris Wright visited in February.

Shell has had a long-running offshore gas project in Venezuela called Dragon that has experienced setbacks in recent years as U.S. policy toward Venezuela shifted. In February, Shell said that general licenses for oil and gas exploration issued by the U.S. will allow the company to move forward with the project.

The latest agreement signed between Venezuela and Shell clears the way for the development of the Dragon gas project and for first gas to be exported to Trinidad by the third quarter of 2027, Trinidad's Energy Minister Roodal Moonilal said on Thursday.

Trinidad and Shell have been trying to develop Dragon and export the gas to Trinidad to increase output from the country's flagship Atlantic LNG plant.

Atlantic LNG is owned by Shell, BP BP.L and Trinidad's National Gas Company NGCTT.UL.

Last year, the company produced 9 million metric tons of liquefied natural gas, according to data from financial firm LSEG, less than its nameplate capacity of 12 million tons because of gas shortages in Trinidad.

A sweeping oil reform passed by Venezuela's legislature in January lowered taxes, expanded the oil ministry's decision-making power and granted autonomy for private producers, among other measures meant to boost investment.

TV FANB, a Venezuelan state television channel focused on the armed forces, said in a post on Telegram that the new agreements with Shell "reaffirms that Venezuela continues to be a safe and reliable destination for foreign investment."

-Bageshri Banerjee, Sheila Dang and Curtis Williams/Reuters