JNOC, Nippon Oil Pull Out of Venezuela Oil Project

Japan National Oil Corp. and Nippon Oil have exited the La Ceiba project located in the Lake Maracaibo area of Venezuela. The two companies have sold their 20% stake in the block to Veba. The value of the sale was not disclosed.

The proceeds are expected to be used to pay back part of the 3.2 billion yen in loans extended for the project by JNOC. JNOC set up Nippon Oil Exploration (Venezuela) Inc. in 1995, jointly with Nippon Oil Exploration, a subsidiary of major Japanese oil firm Nippon Oil Corp. The two companies decided to pull out of the project when the reserves of oil found in the area fell far short of initial expectations. ExxonMobil is operator of the project with a 50% stake and Veba holds the other 50%.