Subscribe to our free daily newsletters
  Energy News  

Subscribe to our free daily newsletters

Analysis: Venezuela, Russia team up on oil

disclaimer: image is for illustration purposes only
by Carmen Gentile
Miami (UPI) Sep 19, 2007
PDVSA is teaming up with Russia's Lukoil to build a refinery in Venezuela pending a thorough exploration of a block in the oil-rich Orinoco Reserve the two nations agreed to develop jointly.

Lukoil officials said Tuesday "the contract has been finalized and is waiting to be signed," Russia's Itar-Tass news agency reported.

However, the agreement won't be signed by Lukoil, Russia's second-largest petroleum company, until the results of the exploration of the Junin 3 block are learned, the company said in a statement.

Orinoco reserves are estimated at 230 billion barrels or more.

Venezuelan Vice President Jorge Rodriguez is in Moscow to meet with Lukoil officials and discuss the state of the bilateral petroleum agreement for Junin 3 and other projects, which according to PDVSA have been two years in the making.

Under the deal, Lukoil will reportedly accept the terms of Venezuela's reconfigured foreign petroleum investment policy and take a 40 percent stake in the Junin 3 block with PDVSA assuming the rest.

The Lukoil-PDVSA and other pacts with non-traditional trading partners such as China appear to be part of Venezuelan President Hugo Chavez's long-term agenda for reducing his country's dependence on the United States and other Western petroleum countries.

Earlier this year Venezuela and Iran inked a $4 billion deal to develop a block of Orinoco, with production slated to begin in two years. The Ayacucho 7 block is believed to hold more than 30 billion barrels of oil alone, making it one of the largest in the country.

A recent statement by PDVSA said Iran will build four oil rigs offshore Venezuela by the end of the year.

Venezuela's increased dealings with Russia and Iran, as well as China, play directly into President Hugo Chavez's plans to shrink the portfolio of Western firms in the country.

Chavez has long asserted the Bush administration was keen on seeing him removed from power because it sees his populist ideals as a threat to the national and regional stability.

Chavez administration officials have repeatedly asserted that if provoked by the United States, PDVSA would have no problem halting oil shipments to the United States, Venezuela's largest customer.

Venezuela in May assumed majority control of its oil and gas operations, forcing foreign firms to accept the new conditions or face fines and expulsion from the country.

Though most companies complied, both ConocoPhillips and Exxon Mobil Corp. pulled out of the country after a protracted struggle with PDVSA.

Their departure has left a production vacuum that PDVSA has yet to fill. Venezuela's oil output is believed to have slipped by more than 250,000 bpd from a year ago, according to the Paris-based International Energy Agency. Production has reportedly decreased from 2.6 million bpd to 2.37 million bpd.

Hoping to counter the shortfall, PDVSA recently announced it was investing $3.5 billion in new oil rigs, a much-needed injection of cash into improvements for a sector that some experts say has been abused by Chavez for his social programs.


Email This Article
Comment On This Article

Related Links
Powering The World in the 21st Century at

Memory Foam Mattress Review
Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News

From plate to engine: French city powers buses with food scraps
Lille, France (AFP) Sept 19, 2007
The French city of Lille is to power a 100-strong bus fleet using biogas fuel made from organic household waste, thanks to a pioneering recycling plant unveiled on Wednesday.

  • EU New Policy Plan Targets Energy Giants
  • Analysis: Venezuela, Russia team up on oil
  • From plate to engine: French city powers buses with food scraps
  • Government Initiatives Drive Latin American Renewable Energy Markets

  • Indian stalemate continues on US nuclear deal
  • Lives, energy supply at risk from 'denials of shipment': IAEA
  • CAR criticizes Areva uranium mine deal
  • UN nuclear chief faces new US criticism

  • Volcanoes Key To Earth's Oxygen Atmosphere
  • Invisible Gases Form Most Organic Haze In Both Urban And Rural Areas
  • BAE Systems Completes Major New Facility For Ionospheric Physics Research
  • NASA Satellite Captures First View Of Night-Shining Clouds

  • Refugia Of The Brazilian Atlantic Rainforest Could Be The Basis For Its Regeneration
  • Indonesia proposes rainforest nations climate group
  • ASEAN urged to muster political will to deal with forest fire haze
  • Humans Fostering Forest-Destroying Disease

  • HARDY Rice: Less Water, More Food
  • UD Leads 5 Million Dollar Research Project On Rice Epigenetics
  • EU proposes easing grain rules to help fight high prices
  • Transgenic Maize Is More Susceptible To Aphids

  • Judge rejects California bid to sue carmakers over warming
  • China to hold first-ever 'no car day' on Saturday
  • Judge hits auto makers, allows Vermont to limit emissions
  • EU automakers reject 2012 deadline for CO2 cuts

  • Cathay Pacific chief hits out at anti-aviation critics
  • Squabble over airline carbon emissions takes flight
  • Boeing Projects 340 Billion Dollar Market For New Airplanes In China
  • KC-30 Tanker's General Electric Power Plant Completes One Million Takeoff And Landing Cycles

  • Nuclear Power In Space - Part 2
  • Outside View: Nuclear future in space
  • Nuclear Power In Space
  • Could NASA Get To Pluto Faster? Space Expert Says Yes - By Thinking Nuclear

  • The content herein, unless otherwise known to be public domain, are Copyright 1995-2007 - SpaceDaily.AFP and UPI Wire Stories are copyright Agence France-Presse and United Press International. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by SpaceDaily on any Web page published or hosted by SpaceDaily. Privacy Statement