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CARACAS (Reuters) - Venezuela and Trinidad and Tobago said that Venezuela's state oil company PDVSA will work with U.S. company Chevron (CVX.N) to develop an offshore natural gas field, one of three that span the Caribbean countries' maritime border.
The deal follows six years of binational talks about how to share the reserves fairly. Venezuela wants to develop its neglected natural gas fields, in part to feed demand for electricity that is straining its hydropower production network.
The PDVSA-Chevron joint venture will explore the largest of the shared fields, the Loran-Manatee bloc, Venezuela's Energy Minister Rafael Ramirez said at the signing ceremony on Wednesday.
The Loran-Manatee field has proven reserves of just over 10 trillion cubic feet (tcf); under the agreement 73.75 percent belongs to Venezuela and the rest to Trinidad and Tobago.
Venezuela was allocated 64 percent of the second-largest bloc, Cocuina Manakin, which has 0.74 tcf of reserves, Ramirez said, while Trinidad and Tobago has 84 percent of the third, the 0.31 tcf Dorado-Kapot field.
The minister did not specify when the joint venture would start work.
There was no immediate response from Chevron to a request for comment.
Chevron currently participate in six onshore and offshore production projects in the country, in partnership with PDVSA.
Under the agreement, PDVSA will build a gas pipeline of about 170 miles from the Loran-Manatee bloc to the Paria Peninsula on the Venezuelan coast. That area is the focus of a high profile but long delayed Venezuelan offshore natural gas project called Mariscal Sucre, where reserves are estimated at 14.7 tcf.
Venezuela's gas projects have languished for years, stalled by low domestic market prices and industry fears of expropriations by the government of the late socialist leader Hugo Chavez that left PDVSA struggling to attract partners.
Chavez nationalized almost all the OPEC nation's oil industry during his 14-year rule. Before his death from cancer earlier this year, he said his government hoped to certify as much as 400 tcf in natural gas reserves, up from 195 tcf now.
Reporting by Diego Ore; Writing by Daniel Wallis; Editing by Phil Berlowitz