Venezuela Oct Oil Rig Count Up 23% Year-On-Year

CARACAS (Dow Jones Newswires), November 19, 2008

Venezuela totaled 76 operating oil rigs in October, a 23% increase from the same month a year ago.

The Andean country increased its total oil rig count by 14 from October 2007, according to data by oil services company Baker Hughes Incorporated.

October's oil rigs were also up by seven compared with the prior month. Baker Hughes' figures also counted 8 operating natural gas rigs.

Petroleos de Venezuela SA, PdVSA, said early last month the country has 172 oil and natural gas rigs in operation, only 84 of which were actually used to drill new wells.

PdVSA officials insist oil rig counts by Baker Hughes fail to take into account dozens of other drills used to clean and improve the productivity of old wells.

Venezuela still secures almost three quarters of its rigs through contracting with foreign suppliers but the government has vowed to change that in time.

President Hugo Chavez has signed agreements with Chinese companies to erect a drill assembly plant in Venezuela that can supply the country's needs.

So far PdVSA has purchased 13 Chinese oil rigs but the oil rig assembly plant is in the design stage.

Since an oil industry strike that paralyzed Venezuela's energy industry for three months in early 2003, PdVSA has tried to limit its dependence on privately owned foreign suppliers.

State officials say for security reasons, the government now owns and controls more than 50% of the oil rigs operating.

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