Opinion

Venezuela’s Long Road to Production Collapse Fueled by Challenging Reservoirs and Underinvestment, Says GlobalData


The collapse of the Venezuelan economy has been fed by a continuing drop in crude oil production. The country's annual production has gone from an estimated 2.86 million barrels per day (mmbd) in 2010 to 2.07mmbd in 2017. The steepest production declines have occurred in the mature fields of the Maracaibo and East Venezuela basins, according to GlobalData, a leading data and analytics company. 

This collapse in production has been somewhat mitigated by crude oil production growth in the Orinoco Belt, but as the central government has increasingly required more funds to manage the country's economic crisis and comply with scheduled debt payments, the capital expenditure allocated to development of Petróleos de Venezuela SA (PDVSA)'s upstream projects has dwindled.

PR1496

IMAGE FOR PUBLICATION: Please click here for enlarged chart

In spite of the overall underinvestment in the country's upstream sector, the Orinoco Belt has seen growth over the last decade, with only a few years having experienced declines of around 5%. 

The Orinoco Belt is where foreign operators have concentrated the bulk of their development activity. Most of the International Oil Companies that originally developed the Belt still maintain their operating assets. Operators like Total and Statoil recovered their initial investment in the Orinoco at the end of the 1990s. These operators have now reduced their personnel to a minimum and entered somewhat of a holding position. Repsol and ENI have also taken a step back even after having invested an estimated $2.4bn over the last five years in the offshore Perla field in the Maracaibo Basin. ENI recently de-booked the reserves of the field, and Repsol noted a clear reduction in capital expenditure for the project.

There are some companies that have expanded their presence in the country recently due to specific agreements, in particular China National Petroleum Corporation (CNPC). 

As long as there is no tangible regime change, it is hard to conceive the Venezuelan oil and gas sector making the changes necessary to improve the trajectory of the country's industry.


Visit source site

https://energy.globaldata.com/?utm_source=email&ut...

GlobalDataVenezuelaOilOrinoco BeltProductionSouth AmericaChina National Petroleum Corporation CNPCCNPCTotalRepsol

More items from oilvoice


Chevron Projects Drive Australian LNG Export Surge in 2017-18

Australian LNG exports surged by 9.3 Mt (18.5%) to 59.7 Mt in 2017-18. The biggest drivers of increased shipments were Chevron's new projects. Shipments from Gorgon grew by 6.9 Mt to 12.7 Mt while the start-up of Wheatstone produced 2.1 Mt. Both projects have further room to grow this year, to ...

OilVoice Press - OilVoice


Posted 58 minutes agoPress > LNGLiquified Natural GasAustralia +5

Genel Energy: Update on Tawke PSC

Genel Energy plc ('Genel') notes that DNO ASA, as operator of the Tawke PSC (Genel 25% working interest), has today announced a two-thirds increase in production from the Peshkabir field in the Tawke licence in the Kurdistan Region of Iraq to 25,000 bopd following completion of the Peshkabir-4 well ...

OilVoice Press - OilVoice


Posted 1 hour agoPress > Genel EnergyTawkeTawke PSC +4

DNO Picks Up Peshkabir Production in Kurdistan

Oslo, 17 July 2018 - DNO ASA, the Norwegian oil and gas operator, today announced a two-thirds increase in production from the Peshkabir field in the Tawke license in the Kurdistan region of Iraq to 25,000 barrels of oil per day (bopd) following completion of the Peshkabir-4 well testing program. ...

OilVoice Press - OilVoice


Posted 1 hour agoPress > DNOPeshkabir FieldProduction +5

Fairfield Geotechnologies Successfully Completes Gulf of Mexico Ocean Bottom Node Survey

Safe and efficient deployment of ZXPLR™ in a working oilfield HOUSTON, TEXAS, 17 July, 2018 – Fairfield Geotechnologies announces the successful completion in May 2018 of the Stampede deepwater ocean bottom node survey, located in the Green Canyon area of the Gulf of Mexico.  The field, operat ...

OilVoice Press - OilVoice


Posted 1 hour agoPress > Fairfield GeotechnologiesGulf Of MexicoGOM +2

Lundin Petroleum: Update on Second Quarter 2018 Financial Results

For the second quarter 2018, Lundin Petroleum AB (Lundin Petroleum) will expense pre-tax exploration costs of approximately MUSD 6, recognise a net foreign exchange loss of approximately MUSD 153 and realise a gross profit from marketing third party crude oil of MUSD 0.5. The profitability for t ...

OilVoice Press - OilVoice


Posted 1 hour agoPress > Lundin PetroleumFinancial Results
All posts from oilvoice