BP And Shell Dive Deep: New Exploration Deal With Trinidad And Tobago Following Complex Negotiations

A consortium of BP P.L.C. BP and Shell PLC SHEL has received licenses for exploration in three deepwater blocks from the government of Trinidad and Tobago to boost the country's hydrocarbon development.

This decision of the Cabinet of the Caribbean nation, taken on September 8, 2023, by the Minister of Energy Stuart Young, has been backed by "complex negotiations" over the terms and conditions, a statement from Trinidad and Tobago's Ministry of Energy and Energy Industries said.

The ministry added that the blocks are located in deep water and require different and novel considerations due to the nature of the expected exploration and possible future production. 

Also See: California Sues Exxon, Shell And BP Over 'Shameful' Deception: 'Sickens You To Your Core'

The award ceremony will take place on Tuesday, September 26, 2023, with the parties signing the material Production Sharing Contracts (PSCs).

"Minister Young expressed his pleasure at the fact that these blocks will be awarded and what it means for Trinidad and Tobago as the deep water is a new frontier in our country's hydrocarbon development," the statement read. 

Also Read: Shell Eyes Partners For Renewable Assets In India To Amplify Profits: Report

The contract comes almost nine months after Trinidad's government refused bids initially submitted by the consortium for failing to meet minimum thresholds, Reuters said in a report.

Shell and BP made amendments to their original bids to retain drilling at least in three deepwater wells under a proposed minimum work program, the report added.

Price Action: SHEL shares are trading higher by 0.59% premarket to $64.84, while BP shares are trading higher by 1.42% to $38.65.