Rafael Ramirez, Minister of Energy and Petroleum of the Bolivarian Republic of Venezuela and President of PDVSA, the state-owned oil company and Paolo Scaroni, Eni’s CEO, have signed a strategic agreement for the development of a block located in the Orinoco oil belt (Faja).
The Orinoco belt is the world’s largest deposit of heavy oil with original oil in place equal to 1,300 billion barrels and huge reserves which are mostly still undeveloped (current oil production is approximately 600,000 barrels per day).
The agreement between Eni and PDVSA relates to the Junin Block 5, one of the most prospective blocks in the Faja. Located in the State of Anzoategui, some 550 kilometers south east of Caracas, the block covers an area of approximately 670 square kilometers with a resource potential, already indicated by several wells, preliminarily estimated to be in excess of 2.5 billion boe. PDVSA and Eni have agreed to carry out joint studies aimed at confirming the block’s reserves as well as identifying the most suitable development program.
Upon the successful completion of the joint studies, the award of the prospective area to a PDVSA (60%) - Eni (40%) joint venture will be requested and the development plan will then be sanctioned. The development will be aimed to achieve early production of 30,000 barrels per day and a long term production plateau of 300,000 barrels per day.
Through this integrated project PDVSA and Eni will further strengthen and consolidate a strategic alliance which will allow the development of important resources for the country, and also enhance their value through the use of innovative technologies which may in the future be applied to other Venezuelan fields.
Eni intends to offer its experience and leading technology to maximize the value of the heavy oil. In particular, it will make available its EST (Eni Slurry Technology) proprietary technology. This is a highly innovative technology for the complete conversion of heavy oils, bitumens and asphaltenes (the hard part of heavy oils) into high-quality light products, eliminating the production of both liquid and solid refinery residues.
In the Bolivarian Republic of Venezuela, Eni owns a 26% stake in the Petrosucre mixed enterprise (PDVSA/CVP 74%, Eni 26%) which operates the Corocoro field, where oil production has just started, and a 19.5% stake in Petrolera Guiria mixed enterprise (PDVSA/CVP 64.25%, Eni 19.5%, Ineparia 16.25%) which manages the Punta Sur discovery. Corocoro and Punta Sur are both located offshore in the Gulf of Paria. In addition, Eni owns a 50% stake in the Cardon IV gas exploration licence, located offshore in the Gulf of Venezuela.
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