Rosneft, PDVSA unit to form Orinoco JV

Rosneft and a subsidiary of Petroleo de Venezuela SA have signed an agreement to form a joint venture to develop heavy oil resources in Venezuela’s Orinoco belt.

The Russian company will hold a 40% interest, and Corporacion Venezolana del Petroleo (CVP) will hold 60% in the venture formed for the Carabobo-2 project.

The venture will develop resources estimated at 40 billion bbl of heavy oil on the Carabobo-2 North and Carabobo-4 West blocks, covering 342 sq km.

Work envisioned under the venture includes exploration and development and construction of ground facilities and pipelines. An upgrader is planned.

According to Rosneft, production will peak at more than 400,000 b/d.

Rosneft is to pay CVP a two-part bonus totaling $1.1 billion and offer it a loan of $1.5 billion.

The companies also signed a confidentiality agreement providing Rosneft access to geological data on blocks off Venezuela for possible future cooperation.

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