ChevronTexaco Proposes Heavy Crude Project in Venezuela

ChevronTexaco proposes to build a project to upgrade extra heavy crude oil from Venezuela's eastern Orinoco belt, ChevronTexaco's Latin America president Ali Moshiri said on Friday.

"ChevronTexaco is committed to Venezuela and as a part of this commitment we are proposing a new major project in the Faja that is composed of an upstream development, a pipeline and an upgrader complex capable of manufacturing from 200,000 to 400,000 barrels per day of high-quality synthetic crude and products," a ChevronTexaco spokesperson quoted Moshiri as saying.

Reuters reported that project investment would be US$6bn, but the spokesperson could not confirm that figure.

A deal for the new project would be signed under terms offered by Venezuela's 2001 hydrocarbons law, which some foreign companies have criticized as unfavorable to new investment projects, Reuters reported.

Crude from the Orinoco is too heavy for normal refineries to process and must be mixed with lighter crude or upgraded into synthetic oil for processing.

ChevronTexaco has a 30% stake in the US$4bn Hamaca heavy crude upgrade project, which is scheduled for completion later this year. ConocoPhillips (NYSE: COP) owns 40% of the Hamaca project, while Venezuela's state oil company PDVSA owns the remaining 30%.

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