CARACAS (Reuters) – Venezuela’s Oil Minister Rafael Ramirez said yesterday he would meet next week with companies interested in bidding for the Carabobo oil blocks in the Orinoco heavy crude region.
The auction was delayed earlier this year as lower oil prices made some companies baulk at the costs associated with developing the blocks.
Speaking to reporters, Ramirez gave few details of next Tuesday’s planned meeting beyond saying they would look at the economics of the projects and the makeup of consortiums.
“The companies are ready with their consortiums and what we are waiting for is to finalise some agreements, especially with regards to the economic aspects,” he said.
Ramirez said in August that Venezuela aimed to finish the bidding by the end of this year in what would be the first such oil tender in socialist-run Venezuela for a decade.
Companies interested include Britain’s BP, US-based Chevron, China’s state-owned CNPC, Colombia’s Ecopetrol, Italian ENI and Portugal’s Galp Energia.
The Carabobo Project aims to build three upgraders to turn the Orinoco belt’s tar-like crude into oil for exports and produce around 200,000 barrels per day, with the initial investment seen between $10 billion and $20 billion per area.
Ramirez said that in another Orinoco block, Junin, where foreign firms are forming joint ventures with state company PDVSA, the medium-term goal is to produce 1.85 million bpd.
Adding expected output of 1.2 million bpd from the Carabobo project, that would raise the medium-term goal for the whole Orinoco region to 3.05 million, he said.
Asked about the global industry, Ramirez said that $80 a barrel was a “reasonable price” for crude, though he did not give a time frame for that. Oil prices jumped more than 2 percent yesterday to top $71 a barrel.
