PDVSA and ANCAP sign agreement for crude production and upgrading

abarrelfullabarrelfull wrote on 09 Feb 2014 19:50

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With the purpose of continuing to strengthen the South American energy union, Uruguay’s and Venezuela’s state-owned oil companies signed an agreement this Saturday August 30th to evaluate production activities (upstream) in hydrocarbon fields of the Ayacucho 6 Block, Ayacucho Area, in the Orinoco Oil Belt, as well as their upgrading (downstream) and international commercialization.

The agreement was signed by the president of Uruguay’s National Fuels, Alcohol and Portland Administration (ANCAP by its initials in Spanish), Raúl Sendic, and the People’s Minister for Energy and Petroleum and president of Petróleos de Venezuela (PDVSA), Rafael Ramírez Carreño.

Minister Ramírez informed that the drilling of wells that will determine the amount of reserves in said block has already been completed, and that 19,000 more barrels of Oil Originally in Place (OOIP) are being certified with a 20% recovery factor to produce 3.8 billion barrels of crude reserves, which can be used to develop production projects of up to 200,000 barrels each.

It is important to point out that ANCAP worked with PDVSA and the Argentinean company Enarsa in this process to certify reserves in the Ayacucho 6 Block, and that now they are preparing for the second phase of the work, which includes the creation of a technical commission that will specifically study investment projects, production and the business plan, the latter being the steps preceding the incorporation of a joint venture company between the two countries.

Minister Ramírez pointed out that ANCAP’s participation raises the list to 22 companies from 18 countries that operate in the Orinoco Oil Belt in an area of approximately 55,314 square kilometers divided in 29 blocks, and which constitutes the largest hydrocarbon reserve in the planet with 272 billion oil barrels of reserves.

Minister Ramírez also indicated that integration between both nations is based on the Energy Security Treaty signed in August of 2007, under which Venezuela undertook to supply the fuel, petroleum and gas needed by its sister nations.

The president of ANCAP, Raul Sendic, pointed out that the agreement will determine the needs of La Teja Refinery, located in Uruguay and with a current processing capacity of 50,000 barrels per day, to evaluate the investments necessary so that the crude extracted from the Orinoco Oil Belt can be processed there and later commercialized.

The ceremony was also attended by Eulogio Del Pino, president of the Corporación Venezolana de Petróleo and director of PDVSA, and by Nelson Martínez, president of PDVSA América, among others.

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