The four liquefaction trains that comprise Trinidad and Tobago's Atlantic complex will operate as a single unit under a restructuring agreed by the government and the shareholders, led by Shell and BP.
The agreement will also boost the government's income from LNG exports, according to a joint statement issued by the government and the companies.
The restructuring "will result in the unitization of the Atlantic entities that own the four LNG trains into a single entity with a simplified commercial structure which will enable long-term investments in the upstream and at Atlantic," they said.
Negotiations that will take place under the agreement will "seek the equitable sharing of returns for both Trinidad and Tobago and the Atlantic shareholders."
The government and the companies will also complete negotiations that started in June 2019 to extend the life of Atlantic Train 1 beyond March 2020. The 3mn t/yr Train 1 began operating in 1999.
BP had said in May 2019 it may close Train 1 after 2019 because of a shortage of natural gas.
BP and Shell are the top shareholders in the 14.8mn t/yr Atlantic liquefaction plant in southwestern Trinidad. They are also the Caribbean country's leading gas producers.
Minority Atlantic partners are Trinidad's state-owned gas company NGC and China's sovereign wealth fund CIC unit Summer Soca.
"Shell, BP and NGC as shareholders of Atlantic believe that restructuring will help ensure sustainability of Atlantic and will create the environment for future investments in Trinidad and Tobago's gas industry," the statement said.
For years, Trinidad has curtailed domestic gas supply to industrial users, including Atlantic and petrochemical plants. A Shell-led plan to supplement domestic supply with pipeline gas imports from neighboring Venezuela remains on ice. Despite ongoing exploration and development projects focused offshore, Trinidad's gas demand still surpasses its production.
The different ownership structure of each of Atlantic's four trains has complicated feedstock allocation since Trinidad's gas production started falling a decade ago.
Shell is Atlantic's majority shareholder with an overall 53pc stake in the complex. BP holds 39.2pc overall while NGC has a 10pc interest in Train 1 and 11.11pc in Train 4. CIC owns 10pc of Train 1.
The restructuring is intended to establish "a more flexible system of gas delivery to all four trains to cover any shortfall from any source, and to allow supply arrangement to overcome the differing shareholder structures of each train," the government said in June 2019.
Atlantic produced 26.5mn m³ of LNG in January-November 2019, up by 2.3pc from a year earlier, according to Trinidad's energy ministry.
The country's gas output of 3.61 Bcf/d in the 11-month period rose by 1pc year on year.
By Canute James