Venezuela to Give Oil JV Partners More Autonomy, Ramirez Says

Venezuela will give foreign partners in heavy oil joint ventures more autonomy in hopes of boosting production from today’s 1.2 million barrels per day to 4 million barrels per day by 2019.

Foreign companies operating in the Orinoco heavy-oil belt will have more autonomy to make decisions on investments and operations, Venezuelan Oil Minister Rafael Ramirez told reporters today in Caracas. Ramirez, who also serves as president of state-owned oil company PDVSA, wants partners to assume a more active role.

“If companies have the capacity to bring in additional rigs for the joint ventures, we have no problem,” Ramirez said.

Venezuela’s Orinoco heavy-oil belt, also known as the Faja, contains estimated oil reserves of 1.36 billion barrels.

“We’re looking to reduce bottlenecks while optimizing and increasing the capacity of our existing upgraders,” Ramirez said. “We also expect to achieve early production of at least 50,000 barrels per day as the production from our upgraders has reached a maximum.”

Venezuela plans to invest nearly $200 billion in the Faja in two phases, Ramirez said. PDVSA will invest $24 billion through 2016 to expand existing upgraders and another $108 billion after 2016 on new upgraders and infrastructure, he said. The rest of the money will be dedicated to drilling wells and other underground operations.

Venezuela will invest $26 billion next year to boost total production to at least 3.3 million barrels a day, Ramirez said.

To contact the reporter on this story: Jose Orozco in Caracas at jorozco8@bloomberg.net

To contact the editor responsible for this story: Andre Soliani at asoliani@bloomberg.net

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