Venezuelan oil joint ventures switch to Russian bank

Elias Hubbard
February 10, 2019

Juan Guaido, Venezuelan opposition leader and parliament speaker, whose appointment to that position had been cancelled by the country's Supreme Court, declared himself interim president at a rally in the country's capital of Caracas on January 23. The United States and dozens of other nations have refused to recognize Maduro, characterizing his election last year to another six-year term as fraudulent. Maduro has denounced Guaido as a USA puppet seeking to foment a coup.

Since then, PDVSA has been pressing its foreign partners at joint ventures in its Orinoco Belt producing area to formally decide whether they will continue in the projects, according to two sources with knowledge of the talks.

The United States has delivered the first batch of humanitarian assistance for Venezuela to the aid collection center in the Colombian city of Cucuta, located at the Venezuelan border, the US Department of State said on Sunday. "But we stress that no new accounts were opened and are planned to be opened in the bank", the spokesman said. The joint ventures' partners include Norway's Equinor ASA, US-based Chevron Corp. and France's Total SA.

Venezuela is home to the world's largest oil reserves, and oil sales account for roughly 98 percent of export earnings and as much as 50 percent of its GDP.

At the same time, the bank also admitted that PDVSA does have some accounts in Gazprombank but they were opened "several years ago" as part of the oil giant's cooperation with some Russian companies.

On February 4, most European Union member-states recognized Guaido as Venezuela's interim president.

Sanctions created to deprive Maduro of oil revenue have left an armada of loaded oil tankers off Venezuela's coasts that have not been discharged by PDVSA's customers due to payment issues. In response to the USA sanctions, PDVSA pledged to diversify its sales and reroute exports to customers, who are willing to buy its oil regardless of any unilateral restrictions imposed by Washington.

PDVSA also ordered its Petrocedeno joint venture with Equinor and Total to halt extra-heavy oil output and upgrading due to a lack of naphtha needed to make the production exportable, as the sanctions prohibit USA suppliers of the fuel from exporting to Venezuela.

Other reports by Click Lancashire

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