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Rosneft, PDVSA sign agreements for offshore projects

OAO Rosneft and Petroleos de Venezuela SA (PDVSA) have signed a cooperation agreement for offshore projects in the Rio-Caribe and Mejillones blocks, the second stage of the Mariscal Sucre gas project ( OGJ Online, July 3, 2013 ). The companies intend to continue negotiations on key technical requirements and commercial and legal terms for establishment of joint ventures to develop Rio-Caribe and Mejillones. The parties also agreed to set up joint ventures for engineering, construction, and well servicing, and held negotiations on LNG plant construction. The signings took place during a visit to Caracas by Rosneft Pres. Igor Sechin. Rosneft and PDVSA have five joint oil production projects in Venezuela: Carabobo-2 and 4, Junin-6, PetroMonagas, Boqueron, and Petroperija.

Posted On : Published By : Tom Whipple
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Cash-Poor Venezuela Weighs Sale of Citgo

Venezuela, strapped for cash at home and staring down costly litigation overseas, is considering a deal for its U.S.-based refinery company Citgo Petroleum Corp. as well as a stake in a refinery run with Exxon Mobil Corp. , according to a Citgo document and people familiar with the matter. People close to Petroleos de Venezuela SA, or PdVSA, say the state-run oil giant is in the early stages of considering a deal for Houston-based Citgo, which operates three refineries. It is separately shopping its 50% stake in the Chalmette refinery in Louisiana, a process that is further advanced, they said. A July 15 bond prospectus for Citgo states that PdVSA "is currently seeking to monetize its ownership interest in us." A spokesman for PdVSA said he had no information on any potential asset sales. Exxon also declined to comment. PdVSA, the principal source of hard currency in Venezuela, is […]

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Venezuela could tap Chinese market by selling Citgo

Selling off U.S. refiner Citgo would free up export volumes for Venezuela to start directing oil to the Chinese market, Energy Ministry officials said. The Venezuelan Energy Ministry said it’s considering separate offers for Citgo from Deutsche Bank, Goldman Sachs and JP Morgan. Sources inside the ministry told Argus Media offers range from $10 billion to $15 billion. Combined refinery output from Citgo is 757,000 barrels per day, with most of that centered at its Lake Charles facility in Louisiana. Argus reported Thursday the sale of Citgo would free up exports the state-owned oil and gas company known as PDVSA could direct toward China. Both sides have agreements to increase exports by more than 60 percent to 1 million barrels of oil per day by 2016. Venezuela is the No. 4 oil exporter to the United States, behind Canada, Saudi Arabia and Mexico, respectively. For the week ending July […]

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Production Dries Up Amid Currency Woes and a Scramble for Parts

This car-crazed country’s auto industry, once the third largest in South America, is seizing up as manufacturers struggle to produce a few vehicles a day. Car makers, including global giants like Ford Motor Co. , Fiat Chrysler Automobiles NV, General Motors Co. and Toyota Motor Corp. , have cut output by more than 80% in the first six months of the year compared with a year earlier because of a lack of dollars to pay parts suppliers, according to data compiled by the Automotive Chamber of Venezuela, which represents car makers. "This is the first time I have ever seen things this bad," said 61-year-old Antonio Lopez, a Ford worker who recently prepared a sedan for painting at the auto maker’s factory […]

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Brazil, China Sign Power-Grid, Plane Deals

China and Brazil signed a number of deals on Thursday, ranging from jet sales to power-grid investments, at the end of a summit meant to showcase a bigger global role for emerging economies. The agreements come as Chinese President Xi Jinping wraps up a visit to Brazil for a meeting of the Brics nations, comprising Brazil, Russia, India, China and South Africa. With China’s growing influence in Latin America, Mr. Xi’s presence far outweighed that of the other visiting leaders, most of whom left earlier in the week. In one of the deals, Brazilian plane maker Embraer SA clinched an order to sell 60 regional airplanes to Chinese companies, totaling $3.2 billion at list price. The agreement marks a major advance in Embraer’s China business—a market it has been cultivating for years. Not too long ago, Brazil and China had virtually no trade between them. But in the last […]

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Putin vows to help develop offshore Cuba

Russian President Vladimir Putin said at the conclusion of a regional visit his government would help Cuba’s state oil company develop offshore reserves. Putin met in Havana with Cuban President Raul Castro during a tour of Latin American countries. Putin said Russian oil company Rosneft would help its counterparts at state-owned Cubapetroleo develop offshore Cuban reserves. "Developing new blocks on Cuba’s offshore shelf is (expected) in the very near future," the Russian president said Sunday. Cuba has limited proven reserves of its own and relies on imports from Latin American countries to meet its energy demands. Cuba had weighed joint partnerships with its Russian counterparts as recently as 2012. Cuba aims to cut the amount of oil it imports from Venezuela through development of its own offshore reserves. The U.S. Energy Information Administration estimates that, as of 2009, Cuba had less than 1 billion barrels of oil reserves.

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Premier’s CEO Seeks to Top Oil Target, Get Falklands Partner

Premier Oil Plc (PMO) ’s newly appointed Chief Executive Officer Tony Durrant has three immediate priorities to consolidate a share-price gain of more than 20 percent since he took the job this year. He plans to bring onstream the $1.4 billion Solan field located west of Shetland before the end of the year, find a partner to share a $5 billion investment to develop the Sea Lion project off the Falklands, and exceed an oil-production target. Durrant, who was promoted to the top job at the London-based explorer on June 25 after being chief financial officer for about nine years, also aims to double cash flow within five years to about $2 billion a year. “We have to continue to tick the boxes on the things we’ve been doing, continue to restore credibility, keep the production up, beat the guidance,” the CEO said in his first interview since taking […]

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Petrobras: Brazilian oil output up

Brazilian energy company Petrobras said its oil production for May was up 2.2 percent to 1.98 million barrels per day when compared with the previous month. Petrobras said it credited May’s production increase to the launch of operations at four new platforms in the offshore Campos Basin. In the Campos and Santos basins alone, Petrobras said oil production increased 8.8 percent from May to 447,000 bpd, a monthly record. Brazil ranks second behind Venezuela in proven oil reserves in South America. Offshore production is complicated because much of the oil reserves lie beneath a thick layer of salt. Petrobras , formally known as Petroleo Brasileiro, has struggled with production levels in the past, but attributed the declines to scheduled maintenance at its offshore fields. The company in a statement Tuesday said new production systems are expected to enter into service this year. A four-year business management plan envisions a […]

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A.P. Møller-Maersk Takes $1.7 Billion Impairment on Brazilian Assets

The oil unit of Danish conglomerate A.P. Møller-Maersk A/S will book a $1.7 billion impairment on its Brazilian assets as it changes strategy in the region, it said Tuesday. However, the company’s full-year guidance remains unchanged with underlying profit of about $4 billion and a group-wide result significantly above last year. Maersk Oil said it would no longer pursue growth for its business in Brazil and as a result has sold its ownership share in the Polvo field to the operator. The company bought stakes in three fields in Brazil for $2.4 billion in July 2011, but decided to take an impairment on them following appraisal drillings that came out at the lower end of expectations as well as increased development costs and a subdued oil price. It is thought that the operating partners in the remaining two fields will be able to present commercially viable development plans, the […]

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PDVSA Profit Surges as Lower Spending Counters Oil Slide

Petroleos de Venezuela SA ’s annual net income rose more than three-fold as the state-owned oil producer spent less on social programs, reduced costs after currency devaluation and sold assets. Profit rose to $15.8 billion last year from $4.3 billion in 2012, according to a bond offering circular dated May 14, a copy of which was obtained by Bloomberg. So-called comprehensive net income was $12.9 billion, up from $5.1 billion. Spending on social projects declined to $13 billion from $17.3 billion in 2012. Ousted Planning Minister Jorge Giordani, who was also removed from PDVSA’s board this month, said in a June 18 letter that the company had started to show “signs of independence” under President Nicolas Maduro, derailing the long-term development goals of former President Hugo Chavez. Venezuela devalued the bolivar by 32 percent in February, 2013, taking the primary official rate to 6.3 bolivars per dollar. The country […]

Posted On : Published By : Tom Whipple