PDVSA Seeking to Boost Stake in Orinoco Projects

Venezuela's state oil company PDVSA is trying to increase its existing stake in each of the four current Orinoco extra-heavy crude projects, company president and energy and oil minister Rafael Ramirez told reporters Monday.

"The issue of equity stake in such projects is very important," said Ramirez. Talking to reporters later he said he had not yet talked to PDVSA's partners in the Orinoco projects about increasing his company's stake. "But we will, we will discuss it and reach a situation [where PDVSA has a majority stake]," he said.

The official also declined to offer a percentage for the size of stake that PDVSA aspires to, but noted the hydrocarbons law passed by the Hugo Chavez administration makes it mandatory for PDVSA to have at least 51% in any oil E&P project in the country.

The big news on Monday, however, was Ramirez's announcement of an increase in the tax and royalty rates to be paid for by such projects so Venezuela's take will now total 83.33%. This increase could mean US$2.1bn extra in revenue for Venezuela, the minister said.

While it is not the majority partner in any of the Orinoco upgraders, PDVSA has a sizable stake in each: in Ameriven (formerly Hamaca), where it partners with US oil majors ConocoPhillips (NYSE: COP) and Chevron (NYSE: CVX), it has 40%, making it the majority partner; in Cerro Negro, where it partners with ExxonMobil (NYSE: XOM) and the UK's BP (NYSE: BP), PDVSA has 41.67%, a stake equal to that of Exxon; in Sincor, PDVSA has 38% to France's Total (NYSE: TOT) 47%, while Norway's Statoil (NYSE: STO) owns the rest: and in Petrozuata, again with ConocoPhillips, it has 49.9%.

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