PDVSA, YPF plan joint projects

by on August 1, 2012 5:58 pm BST

The socialist president gave few other details during a meeting in Brazil with his Argentine counterpart Cristina Fernandez, Reuters reported.

Chavez has been a staunch supporter of her decision this year to nationalize YPF, which belonged to Spain’s Repsol.

 “Let’s work hard … so that YPF is in the Orinoco Belt soon, in fields that are already producing, not virgin fields, in Petroanzoategui, and so that PDVSA can to continue to have a presence in offshore Argentina,” Chavez said according to the news wire.

A PDVSA source told Reuters the companies were in talks and planned to sign a “letter of intention” about joint ventures.

The 130,000 barrel per day Petroanzoategui facility has been operated solely by PDVSA since ConocoPhillips left Venezuela in 2007.

PDVSA has been offering shares in its upgraders — which convert heavy crude into lighter, more valuable oil — as a way to attract funding to boost production.

Operational problems and accidents have plagued the South American OPEC nation’s four giant upgraders since 2009, with production often dropping off. Petroanzoategui has been the most problematic.

 Chavez was one of the most vocal supporters for Fernandez after she nationalized YPF in April, saying the rest of the continent had a duty to support her too.

 This month, he advised Repsol to seek a friendly agreement in its dispute with Argentina and noted that the Spanish energy company also held important assets in Venezuela.

 Repsol faces a long legal battle over the saga. It has sued for $10 billion in compensation and taken steps to file for World Bank arbitration. Fernandez says Repsol did not invest enough in YPF and allowed crude production to decline.