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2009-11-09

Heavy oil congress focuses on Orinoco Belt

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Venezuela announced market conditions for extraction from its massive crude reserve during the 3rd World Heavy Oil Congress on Margarita Island, Nov. 3–5, 2009.

Venezuela announced market conditions for extraction from its massive crude reserve during the 3rd World Heavy Oil Congress on Margarita Island, Nov. 3–5, 2009.

Monday, Nov. 9

PORLAMAR, Venezuela – The 3rd World Heavy Oil Congress took place at the recently expropriated Hilton Margarita hotel on Venezuela’s Caribbean coast. During the event, the host country announced market conditions for extraction from its massive crude reserve located on the Orinoco Belt.

The technical and business event took place Nov. 3–5, explained Agencia Bolivariana de Noticias (ABN), and included the presence of over a thousand representatives from 50 countries and 112 companies, providing a space for attendees to explore economic possibilities.

As a result of the congress, Reuters underscored the creation of at least five joint ventures between multinationals, which will bid on projects to extract crude from the Orinoco Belt. The belt was presented by the Venezuelan government as the largest heavy crude reserve in the world, with a capacity of over 300 billion barrels.

Despite fears resulting from Hugo Chávez’s nationalization policies, a total of 16 companies expressed an interest in taking part in the invitations to submit bids.

Venezuelan Energy and Mines Minister Rafael Ramírez told El Universal that state-owned Petróleos de Venezuela (Pdvsa) expects oil investments to rise from current levels of US$51.3 billion to US$220.4 billion in 2015.

After repeated delays to the original project announced in 2008, reported Reuters, the first invitation to submit bids in over a decade by the Organization of the Petroleum Exporting Countries (OPEC) member will take place Jan. 12–18.

There are already draft association agreements between bidders. China National Petroleum Corporation (CNPC) will bid together with France’s Total. CNPC will also make a joint offer with its compatriot Sinopec. Chevron, of the U.S., will form a partnership with three Japanese companies and Venezuela’s Suelopetrol, while Repsol of Spain will join forces with Petronas of Malaysia and ONGC of India.

The Portuguese company Galp Energía is negotiating a partnership with Norway’s Statoil. Britain’s BP is running alone and Shell may well do the same. The Russian companies, which are already working in other areas of Orinoco, will not bid.

Technically, heavy oil is harder to extract and refine, which is reflected in its price. However, this type of oil is expected to comprise one of the main energy sources of the future.

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