BP Explores Trinidad-Venezuela Gas Field Project Partnership

BP plc (BP - Free Report) and the governments of Venezuela and Trinidad and Tobago have entered discussions aimed at the development of a shared offshore gas field situated in the Caribbean, per a Reuters report. This collaboration marks a significant step toward bolstering natural gas production in the region.

BP's interest in expanding its natural gas output in Trinidad aims to support the operations of the local Atlantic LNG export facility. Over the past five years, the company’s gas production has experienced a notable decline, dropping nearly 1 billion cubic feet per day. This decline highlights the urgency for strategic partnerships and new developments to revitalize the sector.

Operational constraints have plagued the Atlantic LNG facility, with reduced gas output from the island's offshore fields leading to underutilization. Despite boasting a nameplate capacity of 15 million tons of liquefied gas annually across four trains, the facility has been operating below capacity. The idling of its first train since 2020 has further exacerbated production challenges, with the facility producing just 8.2 million tons last year.

According to Reuters, BP acknowledged its engagement with the governments of Trinidad and Tobago and the Bolivarian Republic of Venezuela regarding the potential development of gas resources in the Manakin-Cocuina field. This joint effort aligns with efforts to leverage the shared resources and foster regional cooperation.

The Manakin-Cocuina field, spanning across both sides of the countries' borders and estimated to hold just over 1 trillion cubic feet of natural gas, presents a promising opportunity for energy collaboration. Despite previous challenges, including stalled talks due to U.S. sanctions against Venezuela, the easing of these sanctions has reignited the momentum for cooperation and development in the energy sector.

Venezuela's state-run oil company, PDVSA, expressed its contemplation of issuing licenses for exploring and developing non-associated gas within its jurisdiction of the shared field. This move signifies a commitment to harnessing the untapped potential of the region's natural gas reserves.

Zacks Rank & Key Picks

BP currently carries a Zack Rank #3 (Hold).

Some better-ranked stocks in the energy sector are Sunoco LP, Murphy USA Inc. and Energy Transfer LP, each sporting a Zacks Rank #1 (Strong Buy) at present.

Sunoco is among the biggest motor fuel distributors in the U.S. wholesale market in terms of volumes. By distributing more than 10 fuel brands via 10,000 convenience stores under long-term distribution contracts, the partnership will continue to generate stable cash flow.

The Zacks Consensus Estimate for SUN’s 2024 earnings per share (EPS) is pegged at $4.87. The stock has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.

Murphy USA is a leading independent retailer of motor fuel and convenience merchandise in the United States.

The Zacks Consensus Estimate for MUSA’s 2024 EPS is pegged at $25.58. The company has a Zacks Style Score of B for Growth and B for Value. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.

Energy Transfer is a publicly traded limited partnership, focused on diverse energy assets in the United States. The company’s core operations involve natural gas midstream services, transportation, storage, crude oil facilities and marketing assets.

The Zacks Consensus Estimate for ET’s 2024 earnings per unit is pegged at $1.44. The company has witnessed upward earnings estimate revisions for 2024 in the past 30 days. ET’s 2024 earnings are expected to rise 32.1% year over year.

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