U.S. License Revocation Halts BP-Shell Gas Projects, Shaking Caribbean Energy Strategy
On Monday, the U.S. government revoked key licenses that had allowed BP and Shell to participate in natural gas development projects in Venezuelan waters, specifically the Dragon and Manakin-Cocuina fields. These projects were part of a cross-border energy initiative involving Trinidad and Tobago, which lacks sufficient domestic gas and had partnered with international energy firms to import Venezuelan supply. Under a 2023 U.S. sanctions waiver, Shell and Trinidad's National Gas Company were authorized to work with Venezuela’s state-owned PDVSA to extract gas from the Dragon field, while BP was developing the Manakin-Cocuina field, which straddles both nations’ maritime borders. The U.S., which controls licensing under its sanctions regime on Venezuela, revoked these permissions due to Venezuela’s failure to meet democratic reform commitments.
The move directly disrupts Trinidad and Tobago’s plans to revive its underutilized LNG sector, impairs BP and Shell’s investment strategies, and eliminates a critical revenue opportunity for PDVSA. The decision has broad downstream consequences for regional energy security, geopolitical alignments, and investor confidence across the Western Hemisphere.
The U.S. revocation of BP and Shell's licenses for gas projects in Venezuelan waters underscores the intricate interplay between geopolitics and energy development. While intended to pressure Venezuela toward democratic reforms, this action has cascading effects on regional energy strategies, economic stability, and international relations. Trinidad and Tobago, in particular, faces immediate challenges in securing energy supplies and sustaining its LNG industry. The broader implications suggest a potential realignment of partnerships and strategies as nations and corporations navigate the evolving landscape of energy geopolitics.
Wednesday, April 9, 2025
