PDVSA and Maurel&Prom Signed an Agreement to Develop Oil and Gas Fields in Venezuela
The Venezuelan state oil company PDVSA and the French Maurel&Prom (beneficiary of the Indonesian Pertamina) signed an agreement aimed at increasing oil and natural gas production in the western region of Venezuela.
This was stated by PDVSA General Director P. Tellechea.
- the companies have agreed to a contract that focuses on areas of Venezuela’s oldest manufacturing region, Lake Maracaibo;
- the terms were agreed upon before the US eased sanctions on the South American country in October.
The head of PDVSA, who is also Venezuela’s oil minister, did not provide any other details.
JV PetroRegional del Lago
In 2018, Maurel & Prom bought a 40% stake in PetroRegional del Lago from Shell Plc, becoming PDVSA’s JV partner.
PDVSA owns a 60% stake in PetroRegional del Lago, which operates the Urdaneta Oeste field in the northwestern part of Lake Maracaibo.
Maurel & Prom then promised to increase production at the field from 16 thousand barrels per day to 70 thousand barrels per day.
Western sanctions prevented this, but maybe now everything will get better.
The next control point is 2026, when the joint venture’s license for the right to use subsoil will expire.
For the curious, let us remind you that Lake Maracaibo is connected by a narrow strait to the Gulf of Venezuela.
The same strait along which the pirates of Captain Blood (in the famous Odyssey from R. Sabbatini) with an unexpected maneuver of a flotilla from the bay to the lake successfully besieged the city of Maracaibo, now it is the 2nd largest city in Venezuela after Caracas.
It was reported that Shell had several reasons for leaving the JV, including:
- delays in receiving cash and dividends from the government under the Petroregional del Lago JV;
- a sharp decline in production (in 2016, the joint venture produced only 33 thousand barrels per day);
- Venezuela did not lift the ban on independent oil exports from the project;
- constant theft of equipment and almost daily power outages.
Maurel & Prom:
- founded in 1831 as a shipping company and transformed into a company exploring hydrocarbons on the African continent;
- began cooperation with Venezuela in 2005;
- after 6 years of work in the country, Maurel & Prom Venezuela was sold;
- There was no cooperation with PDVSA until now, when the French decided to acquire Shell’s share in Petroregional.
From February 2017, Maurel & Prom became the beneficiary of the Pertamina Group.
Good Indonesians saved the company from bankruptcy.
US sanctions lifted
On October 19, 2023, it became known that the United States had authorized some transactions with the oil and gas sector of Venezuela.
The issued general license is valid for 6 months, but its validity will only continue if Venezuela fulfills its obligations to hold elections.
The agenda of the negotiations between the United States and Venezuela also included:
- the Venezuelan opposition’s long-standing request for the release of prisoners;
- guarantees of holding elections;
- possible solutions to the problem of the influx of Venezuelan immigrants into the United States.
Lifting sanctions:
- allows Venezuela to freely export oil and natural gas, as well as receive payments and attract investors.
- may be reversible if Venezuela fails to meet election obligations.
Among the companies that could receive U.S. permission this time to receive Venezuelan oil as debt payment was Maurel & Prom MAUP.PA .
On October 10, 2023, the French company said it had sought permission from the U.S. government to enter into an agreement with PDVSA, but declined to go into detail.
