PDVSA gets $1.5 bln loan from Japan to expand refineries
Petroleumworld.com, June 29, 2011
Japan will loan Venezuela $1.5 billion to help fund expansion of two large oil refineries, the South American OPEC member announced on Tuesday.
Energy Minister Rafael Ramirez said Venezuela would repay the loan over 15 years in cash or oil at a rate of Libor plus 3.8 points.
"Japan is helping us very much in the transfer of technology and us as a power are helping Japan diversify its sources of energy." Ramirez told reporters at the signing ceremony.
Venezuela state oil company PDVSA, financial motor of President Hugo Chavez's socialist "revolution", faces falling production and needs funds for several development projects to tap the country's vast Orinoco extra heavy crude belt.
Ramirez said PDVSA posted revenue of $94.9 billion last year while making a net profit of $3.2 billion.
Venezuela will use the loan, from the Japan Bank for International Cooperation (JBIC), eight other banks and two companies, to boost capacity at PDVSA's El Palito refinery more than 90 percent to 280,000 barrels per day, and increase output at the Puerto La Cruz refinery by about a quarter to 210,000 bpd.
Ramirez said both projects were due to start this year and be completed by 2015, adding the El Palito project would allow that refinery to export low-sulphur diesel fuel.
Venezuela also signed two supply contracts on Tuesday with Japanese companies Mitsubishi and Itochu ( 8001.T ) to ship some 4 million barrels of crude a year, Ramirez said.
The new agreements increase Venezuela's oil shipments to Japan to around 11,000 bpd, from about 1,000 bpd in 2009.
Ramirez also confirmed PDVSA would reopen its 2022 bond in a private operation with the central bank.
He reiterated Venezuela's position that there was no need for OPEC to increase production.
Story by Marianna Parraga from
Reuters / Tue Jun 28, 2011 4:27pm EDT
Send this story to a friend
Copyright© 1999-2009 Petroleumworld or respective author or news agency. All rights reserved.
We welcome the use of Petroleumworld™ stories by anyone provided it mentions Petroleumworld.com as the source. Other stories you have to get authorization by its authors.
Internet web links to http://www.petroleumworld.com are appreciated
Petroleumworld welcomes your feedback and comments,
share your thoughts on this article, your feedback is important to us!
We invite all our readers to share with us
their views and comments about this article.Write to email@example.com
By using this link, you agree to allow PW
to publish your comments on our letters page.
Any question or suggestions, please write to: firstname.lastname@example.org
Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7+/ 800x600 pixels