GOVERNMENT and shareholders in Atlantic LNG (ALNG) have reached a heads of agreement (HoA) that will guide the company's restructuring. This was announced in a statement issued by the Energy Ministry on Tuesday.

The ministry said the HoA is being executed by Government, BP,  Shell Trinidad and Tobago Ltd and the National Gas Company (NGC).

"Following intensive negotiations, agreement has been reached on a HoA. BP, Shell and NGC have committed to continue good-faith discussions on the basis of agreed principles and to use reasonable efforts to negotiate and execute definitive restructuring agreements (DRAs) for the ALNG Restructuring Project."

The ministry said the proposed date for completion and execution of the DRAs is June 30.

In a separate statement, Shell confirmed the signing of the HoA.

"Today’s signing is a pivotal milestone for the parties involved who began jointly and co-operatively pursuing non-binding restructuring principles in 2019."

Shell, in a statement, said the HoA allowed further discussions between Government and ALNG shareholders "regarding a simplified commercial structure to ensure the long-term sustainability of the LNG facility."

Shell said the HoA would also lay the platform to accommodate expected future progress from upstream investments for the benefit of TT.

BP, in its statement, said the agreement was a "a significant milestone."

"This provides a framework for continued cooperation among all stakeholders to a create a simpler commercial structure to support more efficient utilisation of the LNG trains and improve value to Trinidad and Tobago," it said.

"The Atlantic shareholders and Government are focused on the next stage of negotiations to get to fully termed agreements, as the delivery of these on a timely basis will be important to underpin decisions on the next wave of upstream investments."

Sources told Newsday the objective of the HoA is to restructure ALNG so its shareholders would own certain percentages in the new entity as opposed to having ownership in its four trains. In the current arrangement, Government, through NGC, only has shares in trains One and Four.

While the HoA may not immediately address issues concerning Train One, which is currently shutdown,  sources said a restructured ALNG, could allow Government through the NGC to access a portion of the revenues from trains which it currently has no shares in.

Train One has been shutdown since November 2020.

In its statement, the ministry also said, "These member shareholders (BP, Shell and NGC) have also entered into a separate HoA in which they have committed to pursue, in good faith, discussions on the restructuring of ALNG."

China Investment Corporation (CIC) which has an equity interest in ALNG Train One, the ministry continued, is not actively participating in the company's restructuring but has been having discussions with the other shareholders and the Government.

The ministry outlined the chronology of events leading up to Tuesday's HoA.

In 2018, Government began discussions wi