David N. Nakamura
Refining/Petrochemical Editor
SAN FRANCISCO, Mar. 15 -- Venezuela will remain a key player in the world's energy balance not only because of its large oil reserves but also because of the refining capacity needed in the Atlantic basin by the end of the decade, says Alejandro Granado, vice-president of refining, Petroleos de Venezuela SA (PDVSA).
Speaking at the opening session Mar. 14 of the National Petrochemical & Refiners Association annual meeting, Granado said, "For the year 2008, the demand for products and refining capacity will be at a breakeven point. . .any disruption would generate a severe energy crisis worldwide."
He said requirements for refined products in the Atlantic basin will increase 12 million b/d toward the end of the decade, leading to a refining capacity deficit net of announced expansions of 4.6 million b/d in 2010.
"Within this scenario, Venezuela is a key player in the world energy balance, as it has abundant oil reserves and a major active refining sector," he said. "Venezuela foresees undertaking major deep-conversion projects and construction of new refineries."
Granado said action must be taken now because construction of a grassroots refinery takes 3-5 years.
He said the PDVSA investments in deep-conversion projects are for three refineries close to the Orinoco oil belt. PDVSA plans to build a total of 500,000 b/d of refining capacity at three sites in Venezuela: Caripito in the northeast, Barinas in the northwest, and Cabruta in the central part of the country.
A 50,000 b/d refinery in Caripito will produce primarily asphalt. A 400,000 b/d plant in Cabruta will serve primarily as a crude upgrader, similar to PDVSA's other joint venture plants. And another 50,000 b/d refinery in Barinas will supply refined products mainly for domestic use.
Overall, PDVSA intends to increase its production capacity to more than 5 million b/d in 2009 from a current level of 3.7 million b/d. This would require investments of $37 billion, of which PDVSA would supply $26 billion with the remaining $11 billion coming from private investors.
Contact David N. Nakamura at [email protected].
