Venezuela is Latin America's leading oil producer
Indian Minister of Oil and Natural Gas Murli Deora (R) and Venezuelan Minister of Energy and Oil Rafael Ramirez (L) exit a meeting in Caracas. Venezuela and India on Tuesday signed a five-year, 400-million-dollar joint venture to drill for oil and gas in Venezuela's oil-rich southeastern Orinoco regionCARACAS (AFP) - Venezuela and India on Tuesday signed a five-year, 400-million-dollar joint venture to drill for oil and gas in Venezuela's oil-rich southeastern Orinoco region, Oil and Energy Minister Rafael Ramirez said.
The joint venture brings together Venezuela's state-owned oil company PDVSA and India's ONGC Videsh Ltd., a subidiary of India's top oil company Oil and Natural Gas Corporation Ltd (ONGC).
With PDVSA controlling a 60 percent stake of the venture and ONGC Videsh Ltd. 40 percent, the two companies will explore the 160 square kilometer (62 square miles) San Cristobal oil field in northern Orinoco, a region the size of Croatia that is rich in heavy crude oil.
Over the next few years, the joint venture is likely to double Orinoco's oil production from its current 30,000 barrels per day to 60,000, Ramirez told reporters at PDVSA heaquarters.
Preliminary studies by both companies also estimated the San Cristobal area can yield 7,476 cubic meters (264 million cubic feet) of natural gas.
India in 2006 increased its crude oil purchase to 50,000 barrels per day, and its trade with Venezuela has grown from 60 million dollars per year in 2004 to 138 million in 2005, and close to one billion in 2006, mostly in oil sales, the Indian Embassy said.
Venezuela, a member of the Organization of Petroleum Exporting Countries (OPEC), is Latin America's leading oil producer, with an estimated 100 billion barrels of crude oil reserves.
Last year, the leftist government of President Hugo Chavez nationalized the Orinoco oil fields, imposing a 60 percent share for PDVSA in all joint ventures in the area, and compensating some foreign oil companies for their lost interest.
Besides India, PDVSA is currently working with oil companies from Russia, Iran, China and Latin American nations in exploiting the heavy Orinoco crude, which is expensive to refine.
When fully tapped, Orinoco's estimated 270 billion dollars of crude oil reserves would make Venezuela at the world's top oil producer, beating current leader Saudi Arabia.
The state-owned Petroleos de Venezuela (PDVSA) will hold a 60% stake, and India's Oil and Natural Gas Corporation (ONGC) will control the remaining 40%. The ONGC will invest $450m in the project.
Venezuela is Latin America's leading oil producer, with an estimated 100 billion barrels of crude oil reserves. The venture is likely to double Orinoco's oil production to 60,000 barrels a day.
'First step'
Venezuelan officials say that the deal is expected that production will start within three years, and that the project will yield 232 million barrels of crude over the next 25 years.
"It's the first association agreement between the two countries," said Venezuelan Oil and Energy Minister Rafael Ramirez, adding that it was "a first step" towards further energy cooperation.
Mr Ramirez also said that Venezuela planned to ship 150,000 barrels of heavy crude a day to India.
Correspondents say that officials are pleased that the deal will provide energy-starved India with much needed fuel.
Murli Deora, India's Minister of Petroleum and Natural Gas, said that India is ready to be Venezuela's partner and reiterated ONGC's commitment to cooperation.
"We would be very happy to work jointly with PDVSA in financing oil recovery and technology," he told a press conference in Caracas.
The Venezuelan government, led by President Hugo Chavez, nationalised the Orinoco oil fields last year.
President Chavez is keen to reduce dependency on the United States, which is the biggest buyer of Venezuelan oil.
The 53-year-old leader, who proudly calls Venezuelans as Indians, indicated that the Latin America's only OPEC member- nation may set up a refinery-cum-petrochemical complex in India to process its crude oil.
Receiving India's Petroleum Minister Murli Deora at his presidential palace Hugo Rafael Chavez Frias expressed his intention to supply one million barrels per day of oil to India in the near future.
He readily agreed to Deora's request for giving India's flagship ONGC Videsh Ltd a stake in one of the four oilfields in the Carabobo and a piece in the Junin Norte Block in the Orinoco heavy-oil basin.
"The political answer is yes," he said, responding to Deora's request. "Now technical team (of Venezuelan national oil company PdVSA) will deal with technical aspects and I am certain even technical aspects will be positive," he told visiting Indian journalists after a 75-minute meeting with the Indian oil minister, the first to visit his country.
The Junin area is believed to hold some 500 billion barrels of in place oil reserves, of which Junin Norte may have about 7-8 billion barrels.
The Carabobo heavy-oil field, which is also in the Orinoco region, may hold 213 billion barrels. About 10 to 20 per cent of these reserves can be recovered. These would be in addition to the 40 per cent share OVL has in the San Cristobal oilfield for which an agreement was signed on Tuesday.
OVL and its 60 per cent partner Petroleos de Venezuela S.A (PdVSA) plan to produce 40,000 barrels per day of oil from the field over an 8-year plateau period after investing over $ 446 million.
"Today we are producing 3.2 million barrels of oil per day. Very soon, we will reach 5 million bpd and even 6 million bpd. So in near future, we might be sending to India one million bpd and it is totally feasible," Chavez said, indicating that oil produced from fields operated by OVL would be exported to India for conversion into fuel.
Venezuela, currently, exports 2 million bpd oil to the US. Another 3,00,000 bpd is exported to China, which Chavez wants to raise it to one million bpd.
"We are happy with the first step we took yesterday (when OVL and PdVSA signed joint venture agreement)... What we are doing is extremely important... to increase joint production (and) to take our oil to India. We are also keen to participate in refining and distribution in India," he said.
PdVSA has been in discussions with PetroVietnam and Petronas of Malaysia for setting up a refinery in Asia by 2012-13. The locations can be Vietnam, Malaysia or India.
India offers strategic locational advantage, Deora explained to Chavez who indicated PdVSA may prefer the nation that already exports fuel to countries as far as Latin America and the US.
"India is one of the largest markets in the world and the visit of the minister (Deora) and his delegation is a very positive signal," he said, adding Venezuela was diversifying its oil trade into Africa, Europe and Asia.
A career military officer, Chavez, defended his nationalisation sphere that this month saw cement industry being taken over by the State. "The nationalisation that we have performed is to solve the old problem that we had inherited. All these businesses were bad for Venezuela."
He, however, assured India of honouring all the signed contracts. "The agreements with India are good because business signed with India will not generate monopoly but will result in oil exports. That is common interest between the two countries," he added.
Making his preferences clear, he said Venezuela under him would choose government to government deals over agreements with private firms as governments represent the people.
"We are not doing business to make money and to benefit a tiny minority or to make rich people richer. We are doing business to benefit our people".
The oil from Venezuela, he said, would "modestly contribute to the growth of India" while calling for a free multi-polar world. "Dont forget, we are also Indians," he proudly announced.
OVL and PdVSA have been working together in the Quantification and Certification project in Junin Norte Block covering an area of about 600 sq km. The recertification jobs will be over by December 2008, after which PdVSA is scheduled to award the development through bidding process.
OVL is expected to be given preference in the development and production phase. The same process would be followed in the four blocks in the Carabobo region (erstwhile Cerro Negro area).
Carabobo-I block, that has been certified to hold 10 billion barrels of heavy crude oil reserves, may see Brazil's state-owned oil company Petroleos de Venezuela SA taking 10 per cent stake and PdVSA getting 60 per cent.
OVL may get the remaining 30 per cent in this field or a similar stake in one of the three remaining fields in the Carabobo region.
Venezuela's leftist President Hugo Chavez is working to wean the OPEC nation off its traditional reliance on energy markets in the United States, which relies on Venezuela for around 12 per cent of its oil imports.
Chavez wants to cement closer ties with state-run firms from nations such as Iran, China, Russia, Cuba and India. These energy companies help PdVSA quantify the heavy-oil reserves in the Orinoco region, a process that may see Venezuela topple Saudi Arabia to become the nation holding the world's largest oil reserves.
----------------------------------------------------------------------
India To Invest $400M In Venezuela Oil Project
Rigzone.com, Tuesday, April 08, 2008
India will invest close to $400 million in Venezuela over the next five years following an accord signed Tuesday in Caracas for the joint exploitation of an oil and natural gas deposit in the petroleum-rich Andean nation's Orinoco Belt. The pact calls for the creation of the mixed company Petrolera IndoVenezolana S.A., with 60 percent of the shares held by the state-run Petroleos de Venezuela S.A., and the remainder by India's
ONGC Videsh Ltd. The company will operate in the San Cristobal area and will undertake the exploration, extraction, collection, transportation and storage of crude and natural gas. Venezuelan Energy Minister Rafael Ramirez said during the signing of the agreement that the San Cristobal field "could increase its daily output from the current 30,000 barrels to 60,000 in the next few years." According to the minister, who is also president of PDVSA, the reserves to be developed in the area over the next 25 years amount to some 232 million barrels. Ramirez underscored the importance of the accord, which he described as the "beginning of relations between the two countries that will keep getting stronger." "These are two economies of two countries that complement each other almost perfectly from an energy point of view...India is one of the world's fastest growing and developing economies with an impressive capacity for refining crude," he said. The minister bet on a "long-term alliance," praised the "extraordinary technical capability" of ONGC, and said that "the San Cristobal field is only the first step." For his part, India's Petroleum and Natural Gas Minister Murlit Deora said that signing the accord is "the beginning of activities and relations between the two nations that we want to strengthen." Deora, who is the first Indian Cabinet minister to visit Venezuela, described the forming of the mixed Indo-Venezuelan company as a "historic landmark for growth and cooperation" between the two countries. Both ministers agreed in pointing to the visit of Venezuelan President Hugo Chavez to India in March 2005 as the starting point of their current bilateral relations.
---------------------------------------------------------------------
Chavez offers oil to India
The Hindu, Friday, Apr 11, 2008
CARACAS (VENEZUELA): Terming India as one of the largest emerging markets in the world and assuring it of full cooperation in addressing its energy security concerns to maintain the economic growth tempo, Venezuela President, Hugo Chavez on Wednesday said he was for a multi-polar world and promised to ensure that Venezuelan oil reached Indian shores in the coming years.
“The visit of the Petroleum Minister, Murli Deora and its delegation is a very positive signal for our expanding relationship. He has brought with him a letter from the Indian Prime Minister, Manmohan Singh and I take this opportunity to send my greetings to the people of India. Breaking past traditions, Venezuela has started diversifying its oil market. In the past, the sole market was the United States. Today, apart from the U.S., we have markets in the Caribbean, Africa, Europe, South America, Asia and even in China.”
Mr. Chavez told a group of visiting Indian journalists in an informal interaction that his country was for strengthening relationship with India and China. It was sending to China one million barrels of oil per day.
“We are happy that with India also we have taken the first step by singing a Joint Venture agreement. It is a very important step and our oil will flow into India very soon. We have approved the presence of India and its companies in our oil fields with this new development.”
Mr. Chavez said Mr. Deora had requested two more areas in the Orinoco belt, including blocks in Carabobo and Junin Northe. “The political approval has been given. What we are doing is extremely important to increase joint production and also take our oil to India. We are also going to participate in refining and distribution in India,” he remarked.
Asked if the process of nationalisation of certain assets was a step in the right direction, Mr. Chavez said what he was doing was in favour of his people and the country. “It was a step towards stability. We need cement in order to build houses but that was being exported by multinational companies and sold to us at expensive rates. It belongs to us and we are buying it at a higher price which was one of the reasons for nationalisation.”
He said the nationalisation was to solve old problems his Government had inherited. “All this was bad business for Venezuela. Now we are doing something good for Venezuela,” he said.
Mr. Chavez said all agreements signed with Indian companies or government would be honoured.
“We are making this commitment today. Because business signed with India will not generate monopoly but will export oil, which is of common interest for the two countries. We have the largest oil reserves in the world. We are determined to diversify our market. Nationalisation is to recover the strategic areas that have been subjected to exploitation,” he said.
President Chavez said his country and government would always give preference to government-to-government deals because the government represented the people.
“The Government of India represents the great people of India. Our government represents the great people of Venezuela. So we are not doing business to make money or to benefit a tiny minority or to make rich people richer. We are doing business to benefit our people,” he said.
Mr. Chavez said Venezuelan oil would contribute to India’s economic growth touching 8 to 9 per cent. “With more than one billion population, they need energy. So we are happy to contribute modestly to the growth of India. By doing that we are contributing to creating a multi-polar world,” he said.
He said he knew multi-national companies very well as Venezuela had been dealing with them for 100 years. “So we know how to deal with them.”
Asked about Mr. Deora’s request for award of two more major oil blocks for India, Mr. Chavez said the political answer is ‘yes.’
“Now a team will deal with the technical aspects and I am certain the outcome will be positive. Today we are producing 3.2 billion bpd of oil. Very soon we will reach 5 million bpd even 6 million bpd. So in the near future, we might be sending to India one million bpd and it is totally feasible.”
---------------------------------------------------------------------
India, Venezuela sign a landmark oil sector cooperation agreement
From ANINew Delhi, Apr 9
India's ONGC Videsh Limited (OVL) has entered into a major partnership with Venezuela's Petroleos De Venezuela S.A. (PDVSA) for jointly developing the San Cristobal oil field.
OVL and PDVSA signed a joint venture (JV) agreement for the San Cristobal Field in Junin, Orinoco Region of Venezuela late last night in Caracas, Venezuela.This JV agreement was concluded in the presence of Petroleum and Natural Gas Minister Murli Deora and his Venezuelan counterpart Rafael Ramirez Carreno.Deora described the event as a historic milestone in the growing cooperation between India and Venezuela in the hydrocarbon sector. "This JV will pave way for more such mutually beneficial projects between the two countries," he added. OVL is a 100 per cent subsidiary of India's leading national oil company ONGC. Under this joint venture, OVL will have a participating interest of 40 per cent, while PDVSA retains the remaining 60 per cent in the San Cristobal Field. They will jointly develop the field from its current production level of 20,000 bbl per day to 40,000 bbl per day. This joint venture will also explore the potential of discovering more hydrocarbons in the unexplored area of the project. In addition, the joint venture will also explore employing Enhanced Oil Recovery (EOR) techniques to improve oil recovery rate in the field. The EOR techniques have been successfully commercialized by ONGC in its western heavy field in India. The Government of India has recently approved OVL's participation in the project with an investment of US 356 million dollars.The signing fructifies the consistent efforts on part of India's Ministry of Petroleum and Natural Gas to take forward relations between India and Venezuela. Venezuela is one of the largest oil producing countries in the world, with about 87 billion barrels of proven conventional oil reserves (OPEC 2006). In addition, it has a huge non-conventional oil deposits (heavy oil). Most of these deposits are located in the Orinoco oil belt.
VENEZUELA PRESIDENT ASSURES FULL COOPERATION IN ADDRESSING INDIA’S ENERGY SECURITY
13:48 IST , APRIL 10, 2008
Terming India as one of the largest emerging markets in the world, President Hugo Chavez of Venezuela assured visiting Petroleum Minister Shri Murli Deora on Wednesday (India time early morning Thursday) of full cooperation in addressing India´s energy security. He expressed his happiness with the on-going cooperation in the oil sector between India and Venezuela and assured his support for more projects. Stressing the importance of relations in the hydrocarbon sector, President Chavez also emphasized that there are many more areas like industry, health, pharmaceuticals, science and technology, etc in which two countries could move forward. He added the initiatives already taken by Venezuela and India highlight that a lot more can be achieved by exchanging enhanced level of interaction by the two nations. It was agreed that the Joint Commission meeting would held shortly and finalize the detailed agenda for cooperation. Shri Deora handed over a letter from the Indian Prime Minister Dr Manmohan Singh to President Chavez. He stressed the need for further expanding cooperation in the oil sector evincing India´s interest to participate in the development of upstream, refining and gas marketing and distribution of Venezuela besides to providing training to its oil technologists in the state-of-art facilities with Indian oil PSUs. Earlier, Shri Deora also had a fruitful meeting the Foreign Minister of Venezuela. A wide range issues were discussed in the meeting including projects for criss-cross investment, avoidance of double taxation, enhancing cooperation in S&T areas, optimum utilization of ITEC scholarship offered by India.
No comments:
Post a Comment