PDVSA has given companies with 32 oil operating agreements in Venezuela six months to migrate to new joint ventures in which PDVSA would have over 50% control. However, instead of putting up cash for the new joint ventures, PDVSA would offer companies the chance to expand E&P in areas near the original field or grant them additional oil and/or natural gas licenses, according to Grisanti.
"Each operating agreement, with its geographic areas and reserves, has a certain market value assigned. The state has to make a capital contribution [in each of the joint ventures to result from the agreements], which can be made by enhancing the [oil] reserves," he said.
The 32 operating agreements produce about 500,000 barrels a day of oil for PDVSA, or roughly 25% of the company's total production. "Enhancing the reserves would mean more oil for both partners. That way there is no disbursement of cash" on PDVSA's part, Grisanti said. PDVSA is keen to maintain current levels of production, he added.
Although analysts have said the government is forcing terms on private companies that violate their existing contracts, Grisanti said that the relationship between PDVSA and companies is based on negotiation rather than PDVSA unilaterally imposing its ideas. From the oil companies' perspective, there is more clarity at least in the sector after months of uncertainty. "Talks have started [between companies and PDVSA about the joint ventures]. It's good, it's going really well," Grisanti said.
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