"What we want is a partner when we go offshore," Tjelta said, declining to comment on either what stake the company would offer a partner on its 100%-owned block, or what company or companies it is in discussions with. There could possibly be an announcement this year, Tjelta added.
Drilling of the first well on the block, the Ballena AX, will start in October and run through January, when Statoil will pause to examine the results, he said.
Statoil has just awarded the drilling contract to Houston-based offshore drilling contractor Transocean, and does not rule out further contracts to help analyze results, he said. Tjelta would not comment on the drilling budget, but said that despite the high expenses incurred after a long planning period and the "challenging" geology, the costs would be in line with industry standards. Ballena AX will be drilled to 12,990 feet and lies in 335 meters of water. There are high expectations for the Deltana blocks and Statoil is "very anxious" to see the results, but "you know nothing without drilling," Tjelta said.
Although Statoil owns capacity in one of only four liquefied natural gas (LNG) regasification terminals in the US, Cove Point, it is not necessarily the case that eventual production from block 4 would be sent there, he said. All of the five Deltana blocks, of which three have been awarded already, will be developed as a joint project under the coordination of state oil company PDVSA, and so the final destination of the gas does not depend entirely on Statoil, he explained.
Statoil wants to make Venezuela a core area, in line with its policy of increasing international growth, Tjelta said.
Apart from block 4, in Venezuela Statoil owns stakes in the Sincor heavy crude upgrade project and an operating agreement for onshore oil block LL652 Statoil has 15% in Sincor, with partners operator Total (47%) and PDVSA (38%), and it has 27% in LL652 with partners operator US-based ChevronTexaco (27%), UK company BP (36%) and US company Epic Oil and Gas (10%).
However, Statoil expects to sell its LL652 stake this year to the other partners. Net production to Statoil there is some 10,000-15,000 barrels a day. "It was planned to be much more," he said, adding that it is better for the other partners to own the block.
As for Sincor, the company is very interested in a second crude upgrader, Tjelta said, and would not comment if this would mean a second plant or an expansion of the existing plant. "There are different alternatives," he said. Neither would he comment on the possible equity stakes in the second project, and said that that matter is in discussion with Sincor partners and the energy and mines ministry.
Regarding the upcoming tender of exploration blocks in the Gulf of Venezuela, "we have the technology, the resources, the financial ability and the market access, and so our participation would depend on how we could negotiate with Venezuela to find a win-win situation," Tjelta said. "Everything that is put out, we will look into," he said.
Statoil has approved a budget that covers large investments that could be used for Venezuela, he said, adding that as the corporate decision has been made, eventual participation depends on specific projects and their terms and conditions. "It depends on what Venezuela wants from private oil companies and foreign oil companies," he said.
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