It’s clear that reviving Venezuela’s oil sector will be a long, expensive undertaking and that few major oil companies are eager to rush into a situation teeming with political, fiscal and operational uncertainty. And while oil is the top priority for a US administration that appears to be calling the shots in Venezuela’s energy sector, some observers note that the country’s gas play could deliver some quick wins in getting more hydrocarbons flowing and kick-starting the rehabilitation process in the South American producer. A large, underdeveloped gas resource offers lower-hanging fruit in the form of cheaper projects that could be used to catalyze revenue flows and generate investor confidence. The challenges in Venezuela — from decrepit infrastructure to security risks to political stability and unpredictable long-term US policy — are well enumerated and not conducive to fast-tracked, large-scale investment. But in addition to its oil wealth, Venezuela also holds some of the world’s largest gas reserves at an estimated 200 trillion cubic feet. But it’s currently producing only around 3 billion cubic feet per day, some 40% of which is flared or vented. Most of the gas resources are located in offshore fields, with another large portion associated with onshore oil production. European majors Eni and Repsol produce about 0.5 Bcf/d from the 17 Tcf Perla field in the Cardon IV Block offshore western Venezuela, all of it sold into the domestic market. The field, which was originally expected to reach a capacity of 1.2 Bcf/d, could also export gas to Colombia via the idled 141 mile Trans-Caribbean pipeline — assuming political tensions between the US and Colombia get worked out.
