Repsol Lowers Venezuela Exposure

(Argus, 4.Nov.2019) — Spanish integrated firm Repsol further reduced its exposure to its upstream business in Venezuela in the third quarter thanks to a small provision and a rise in crude receipts from the country.

The company declined to specify the size of the provision against its upstream assets in Venezuela, but it was less than the €75mn ($83.7mn) of total provisions the company made in the third quarter overall. Repsol largely wrote down its assets in Venezuela in 2018 with provisions of $1.3bn.

Repsol’s assets in Venezuela include its 50pc stake in the Cardon 4 offshore gas venture with Italy’s Eni and a 40pc stake in the PetroQuiriquire heavy crude joint venture with state-owned PdV. It receives payment for the production from the two assets from PdV in the form of crude shipments.

The company received about 3.2mn bl of Venezuelan crude in the third quarter, according to Argus estimates, boosted by five discharges from the country at its Bilbao and Cartagena refineries in September.

Repsol sent cargoes of diesel to Venezuela over the same period, in payment for excess volumes of crude since tankers are usually fully loaded at the export terminal regardless of the amount of receivables due to the firm.

Repsol received 2.3mn bl of Venezuelan crude in the second quarter, and shipped 740,000 bl of diesel, according to Spain’s state-owned petroleum reserves corporation Cores.

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