Chevron, PDVSA sign Petroboscan finance deal

Chevron International and Petroleos de Venezuela SA have signed a $2 billion long-term credit line for their Petroboscan joint venture that PDVSA says aims at raising production at Boscan heavy oil field by 20,000 b/d.

The agreement secures a corporate loan from Chevron to Petroboscan, conditional on the production increase, according to PDVSA.

Boscan, developed in 1947, now produces about 107,000 b/d of 10º gravity oil, mostly used for asphalt. It’s in Zulia state in western Venezuela.

Chevron and PDVSA formed Petroboscan in 2006 to operate Boscan field until 2026 after the government of Venezuela required foreign companies to become minority shareowners in oil-producing projects. Chevron, with 39.2% of Petroboscan, formerly operated the field under an operating services agreement.

Repayment of the new loan, which has a rate equivalent to the London Interbank Offer Rate (LIBOR) plus 4.5%, is expected by June 30, 2025.

Rafael Ramirez, minister of petroleum and mining, said funds will be used to optimize old infrastructure at the field.

The deal pushes to $8 billion the total value of financial agreements PDVSA has signed with non-Venezuelan companies recently.

China National Petroleum Corp. in May signed a $4 billion agreement to raise production of the Petrolera Sinovensa joint venture in the Carabobo area of the Orinoco belt to 330,000 b/d of heavy oil in 2016 from 140,000 b/d at present.

More recently, Rosneft of Russia entered an agreement with PDVSA to provide $1.5 billion in financing to form a joint venture called Corporacion Venezolana del Petroleo for the Carobobo-2 project, aiming at production of 400,000 b/d by 2019 (OGJ Online, May 24, 2013).

And Schlumberger recently agreed to provide a revolving line of credit in an initial amount of $1 billion for delivery of oil services to maintain and increase PDVSA activities and sustain cash flow.

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