China state-run firm to help boost Venezuela oil exports by two-thirds

PUBLISHED : Saturday, 06 August, 2016, 7:36pm
UPDATED : Saturday, 06 August, 2016, 10:33pm

State-run oil companies of Venezuela and China have vowed to boost output at the Orinoco oil belt, the world’s largest crude reserve, in as part of a goal to export about a million barrels a day from the South American country.

Venezuela exports about 600,000 barrels daily, and Petroleos de Venezuela and China National Petroleum Corporation were building new facilities to reach the target, Xinhua reported yesterday.

“We want to ensure a steady supply regardless of oil prices,” Venezuela’s Oil Minister Eulogio del Pino was quoted as saying.

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The companies would improve infrastructure for their Sinovensa joint venture, which operates in the southeast oil belt, to raise output from 170,000 barrels to 275,000 barrels per day.

They planned to build a new dehydration and desalination plant and double the capacity of the Jose Processing Plant in Anzoategui state to at least 330,000 barrels of extra-heavy crude in 2017.

Del Pino said a loan of US$5 billion from China Development Bank had been approved for projects to boost oil exports.

The two nations will also improve transportation links of crude oil from the Orinoco oil belt to China.

“Currently, a supertanker leaves Venezuela every three days for China and it takes 45 days to reach China. We will be able to shorten the voyage by travelling via the newly expanded Panama Canal,” del Pino said.

To this end, a new terminal for will be built this year on the Araya peninsula in Sucre state.

Jieyang in Guangdong Province is also building a refinery for processing up to 400,000 barrels per day.

China has lent Venezuela about US$50 billion over the past decade, much of it intended to be repaid in oil.

But Venezuela’s economic woes – partly triggered by oil prices plunge – has pushed Beijing to be more cautious in granting loans to the country.

China is forecast to account for a third of the projected increase in global oil consumption by 2021, according to Bloomberg.