  |
|
Venezuela's private oil sector shrinks for three consecutive quarters
By Marianna Parraga
El Universal
CARACAS
Petroleumworld.com 11 24 06Amidst historically high oil prices both in the domestic and world markets, the private oil activity in Venezuela at the end of September shrunk for the third consecutive quarter compared to the same period in 2005.
Based on the figures the Venezuelan Central Bank (BCV) disclosed, Gross Domestic Product (GDP) of the private oil sector dropped 11.4 percent in July-September compared to the same period in 2005. This is the largest fall during the last year and comes following a decrease of 7.8 percent in the first quarter of 2006 and a drop of 5.4 percent in the second quarter this year.
Over the first three quarters of 2006, the state-run oil sector recorded a steady growth. It soared 0.6 percent, 4.4 percent and 0.9 percent in the first, second and third quarters, respectively. Such increases offset a small drop the sector recorded in the second and fourth quarters of 2005.
In a communiqué published in local newspapers, BCV explained that increased GDP in the state-run oil sector during the third quarter could be attributable to higher "gross value-added in crude oil production," while the drop in the private oil sector was the result of "preventive maintenance tasks in the plants of some oil enhancing companies at the Orinoco oil belt."
As of July, oil enhancers comprising the partnerships Hamaca and Sincor stopped operations to complete scheduled and non-scheduled maintenance, thus stopping production of some 100,000 bpd in the third quarter and bringing down domestic oil output to 2.5 million bpd, according to the figures disclosed by the International Energy Agency.
That 100,000 bpd private operators did not pump represent a drop of some 16.66 percent compared to the previous quarter, but the decrease is even larger if compared to the same period in 2005.
Hardships
Besides the drop in oil production from the Orinoco oil belt in July-August, strategic partnerships have recorded a slowly steady decline in extra-heavy crude oil drilling since the beginning of 2006. This trend is apparently linked to the process of migration from strategic partnerships to joint ventures -where the Venezuelan state has a majority stake- as provided for under the Organic Law on Hydrocarbons in force.Based on current regulations, the Venezuelan state -through state-owned oil holding Pdvsa shall a minimum stake of 51 percent in such joint ventures. In the case of the partnerships operating at the Orinoco oil belt, such a migration involves restructuring of debt abroad, which amounts to some USD 3 billion.
Talks intended to start this migration process were launched some months ago. In the meantime, the Ministry of Energy and Petroleum continues to claim that the memoranda of understanding under which partners undertake to complete migration will be initialed by the end of 2006.
And last, a 138,000 bpd production cut in Venezuela under the Organization of Petroleum Exporting Countries (OPEC) mainly hit the Orinoco oil belt.
Translated by Maryflor Suárez (msuarez@eluniversal.com)
- Marianna Parraga, mparraga@eluniversal.com, Caracas.
El Universal 23 11 06
Copyright© 2006 El Universal. All Rights Reserved.
Your
feedback is important to us!
We invite all our readers to share with us
their views and comments about this article.
Write to editor@petroleumworld.com
Any
question or suggestions, please write to:
editor@petroleumworld.com
Best
Viewed with IE
5.01+
Windows
NT 4.0, '95, '98 and ME +/ 800x600 pixels