Shell plc is moving forward with preparations for the Dragon offshore natural gas development off the coast of Venezuela by launching the tender process for drilling services. The company is targeting the start of a four-well drilling program in the second quarter of 2027, subject to a positive final investment decision (FID). The project represents one of Venezuela’s most significant offshore gas developments and is expected to play an important role in supplying natural gas to neighboring Trinidad and Tobago.
The Dragon field is estimated to contain approximately 4.2 trillion cubic feet (Tcf) of recoverable natural gas. Under the current development plan, production will be transported by pipeline to Trinidad, where existing infrastructure will process the gas. According to previous government guidance, approximately 70% of production is expected to supply the Atlantic LNG (Liquefied Natural Gas) export facility, while the remaining 30% will support Trinidad’s domestic petrochemical industry. Shell is a 45% owner of Atlantic LNG alongside BP plc, with Trinidad’s National Gas Company holding the remaining interest.
The project is designed to help offset declining gas production in Trinidad, where reduced feedstock has constrained LNG exports and industrial demand. By utilizing existing LNG infrastructure rather than developing a new export facility, the Dragon project offers a relatively efficient pathway to bring new offshore gas volumes to market while strengthening regional energy supply.
The announcement also comes as Shell continues expanding its global natural gas portfolio. Shareholders of ARC Resources Ltd. recently approved Shell’s $16.4 billion acquisition of the Canadian natural gas producer, further increasing the company’s exposure to North American gas resources and reinforcing its long-term focus on supplying growing global LNG demand.
Industry Impact
For the North American oil and gas industry, Shell’s continued investment in large-scale natural gas developments underscores the growing importance of LNG supply chains and cross-border infrastructure. The combination of offshore developments, existing export capacity, and strategic acquisitions signals sustained demand for drilling services, engineering expertise, equipment suppliers, and midstream infrastructure supporting global natural gas markets.
Author: phinds