Webinar Panelist Discuss All Things Guyana

(Energy Analytics Institute, Piero Stewart, 15.Aug.2018) – The three promised to return to discuss all things Guyana again in six months as the small South American country eyes first oil in 2020.

A three person panel — comprised of Guyana’s Minister of Finance, the Honourable Winston Jordan, Trinidad and Tobago’s Former Energy Minister Kevin Ramnarine, and hosted by Caribbean Economist Marla Dukharan — discussed issues related to Guyana included but not limited to oil, economics, finance, supply issues, infrastructure, and migration, among others (watch the full video below).

What follows are brief highlights as posted during the webinar under the Twitter hashtag #LatAmNRG:

From Kevin Ramnarine …

— “In Guyana, we have moved from 1 to 8 discoveries,” Ramnarine says. He continued: “With an 80% success rate, only 2 wells have been dry.”

— “The whole world is talking about Guyana,” Ramnarine says.

— “Oil production in Guyana is expected to come online at 120,000 barrels per day d in 2020 and peak at 750,000 barrels per day by 2025, according to Exxon,” Ramnarine says.

— “In the early years, Exxon will likely recover Capex. Then, by 2025 we could see an exponential rise in revenues [in Guyana],” Ramnarine says.

— “An infrastructure deficit in Guyana has slowed development in the interior of the country,” Ramnarine says.

— “You want a competitive oil and gas sector that supports that sector,” Ramnarine says.

— “The private sector should take the lead to develop [Guyana’s] infrastructure,” Ramnarine says.

From Winston Jordan …

— “ExxonMobil has put Guyana on the map,” Jordan says.

— “We see ourselves as the Dubai of the Caribbean,” Jordan says.

— “Guyana has infrastructure and human capital resources deficits,” Jordan says.

— “The Guyana tax system is expected to become more efficient in the future,” Jordan says.

— “We have a lot of challenges, but none are insurmountable,” Jordan says.

— “Guyana is putting together a migration policy to give certain benefits to those wanting to return home,” Jordan says.

— “Guyana will seek a loan with the World Bank to assist in the migration process,” Jordan says.

— “There is no definite word yet about a future refinery in Guyana,” Jordan says.

(With special assistance from Melissa Marchand, who moderated the Q&A session).

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Whither Guyana?

(Energy Analytics Institute, Pietro D. Pitts, 14.Aug.2018) – On a per capita basis, Guyana is already probably the most resource-rich country on the planet, but is still the poorest English-speaking country, and the 2nd poorest overall after Haiti, writes an Caribbean region economist.

As the size of oil discoveries in Guyana begin to suffer from diminishing marginal stock-value, attention is shifting to the billion-dollar question – will Guyana somehow leapfrog itself into the region’s shiny new Norway, or devolve further into resource-cursed-istan? That’s the question posed by Caribbean Economist Marla Dukharan in her August “Caribbean Monthly Economic Report.”

“Like true West Indian cricket fans, we pray despite formidable odds for Guyana’s success but we smell the molasses-like bittersweet stickiness of corruption and all its concomitant dysfunctionality,” she writes.

Guyana’s Oil Outlook: The Nor-way or the Next-Door-Neighbour-way?

To this end, Dukharan along with the Honourable Winston Jordan, Guyana’s Minister of Finance, and Kevin Ramnarine, the Former Minister of Energy in T&T, plan to discuss the oil outlook for South America’s Guyana in a webinar on Wednesday 15 August 2018.

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Could Guyana’s Oil Fortunes Curse Country?

(Energy Analytics Institute, Pietro D. Pitts, 8.Jul.2018) – Recent success in Guyana’s oil sector could be a wolf in sheep’s clothing.

Guyana doesn’t yet produce oil but in coming years its oil output is expected to surpass that of Peru and Trinidad and Tobago and could approach that of Ecuador, one of two lone OPEC producing countries in South America.

Having the world’s largest oil reserves, the first LNG export terminal in the Americas, or large gas reserves doesn’t mean all a country’s political, economic and social problems will be solved. Just ask Venezuela, Trinidad and Tobago, and Bolivia, respectively. Case studies of these three countries have shown that not just countries in Africa, such as Nigeria, are vulnerable to the Dutch Disease even in the 21st Century.

A look just at Guyana’s poor Corruption Perceptions Index ranking from Transparency International, much lower than the average for the Americas indicates the government is failing in efforts to tackle corruption.

It is hardly likely that Guyana’s faith will change by 2020 when the oil starts flowing and revenues start to climb. What will happen then is almost predictable unless a miracle happens between now and then.

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National Oil Co for Guyana Would Be Disaster

(Stabroek News, 3.Jun.2018) – The creation of a National Oil Company (NOC) will be “a disaster” for this country warns former Government Advisor on Petroleum, Dr. Jan Mangal who says that Guyana should learn from the experiences of sister Caribbean countries, Trinidad and Tobago and Jamaica.

However, the government says that it has been advised by a number of international organizations, including Chatham House of the UK, that a NOC would be beneficial to this country.

“Here we go again with national oil companies in the Caribbean. Both Petrotrin (Trinidad) and Petrojam (Jamaica) are in the news because of corruption,” Mangal said as he urged Guyanese to not support a call for the establishment of one here.

“Guyanese: Please remember these two nations have much larger and better run economies than ours, and much stronger institutions. Hence imagine what will happen in Guyana, with our weaker capacity, if elements in our government and their private sector cohorts are allowed to create a national oil company with access to our oil. It will be a disaster,” he added, pointing to recent scandals in Jamaica and neighbouring Trinidad and Tobago.

Recently, Jamaica’s Petrojam, which supplies a range of domestic, transportation and industrial petroleum products in that country, was hit with a number of allegations of corruption and victimisation. It saw questions surrounding the use of public funds snowballing in recent weeks during which there has been an outcry for Prime Minister Andrew Holness to act, the Jamaica Gleaner newspaper has reported.

Over in Trinidad and Tobago, a forensic audit report by the Canada-based Kroll Consulting Canada found that the state-owned Petrotrin paid a company, A&V, for oil produced between January and June of 2017, which it did not receive. In September, Petrotrin announced that it had launched an investigation into the reports of inconsistencies in the volumes reported from its exploration and production fields.

Mangal, whose contract as an Advisor to President David Granger ended in March of this year, has said that he will, “Outline the mechanism used by some oil companies and their local friends (in government and in the private sector) to defraud needy people in countries around the world, like in Guyana.”

But government says that although the establishment of a NOC is not in its immediate plans, there will be one formed sometime in the future and that it has been advised by several international organizations that it was the way to go.

“Government has been advised by several international organizations, foremost amongst which is Chatham House though Dr. Valerie Marcel, that the NOC is the direction we would be headed. We believe we will get there one day but it is not a matter that is on our list of immediate,” Minister of Natural Resources Raphael Trotman told Stabroek News when contacted.

Further, he added, “The rationale for a NOC is always that countries get a greater share of the revenue and at the same time gain valuable experience. We are keeping the idea alive but there is no discussion when.”

Other experts have also said that they believe that an NOC, if properly equipped with needed regulations and insulated from politics, would serve beneficially to the people of Guyana.

“State controlled oil major, is an absolute must! And the sooner, the better. NOCs control approximately 75% of the world’s oil market and 90% of the world’s oil reserves, evidence that having NOCs have become a normalcy. The advantages of an NOC are unlimited.  In recent years, NOCs have developed global reach and influence,” a former United States Department of Energy Manager, Dr. Vincent Adams had told this newspaper, in an interview earlier this year.

“With the proper contract arrangement with the NOC representing  the Government’s interest, the arrangement allows for personnel from the NOC working alongside their IOC counterparts and `learning by doing’, ultimately acquiring the ability to operate both within its own jurisdiction and abroad; thus, bringing revenues back to their home countries,” he added.

Vehicle

Most significantly, Adams believes, is that NOCs provide a vehicle for state participation and the ability to drive greater local content and capacity building in terms of directing the purchase of local goods and services. “The lessons learned from bauxite was that we were not ready for nationalization, since we failed to build the capacity to manage on our own upon nationalization. An NOC will give us that capability and strengthen our position in negotiations,” he asserted.

Using his country’s experience as a model, former Minister of Energy of Trinidad and Tobago, Kevin Ramnarine had also this year advised on an NOC but stressed that it must be insulated from political interference.

“This company’s board and management must be insulated from politics as is the case with Statoil (Norway) because if it is not, you will get a call to hire somebody’s nephew,” Ramnarine said.

“I would recommend that whatever state companies you form, it doesn’t have to be all, put part of the equity on the stock exchange,” he added.

He pointed to Norway’s Statoil and Russia’s Gazprom among other companies saying that Guyana can earn needed revenue through the establishment of such companies.

Pointing to the detriment of a state company influenced by politicians, as witnessed in his home country, he emphasized that before such a decision be taken here the companies must be removed from politics. “There is also the whole issue of political influence in state enterprises in Trinidad. When we look at the Norwegian company Statoil, their Board of Directors are independent, and for example the workers of Statoil get to vote on who should be a director…you begin to dilute the political influence in the company,” he posited.

The former People’s Partnership Energy Minister recommended that Guyana set up three state-owned companies. “I am going to recommend that Guyana sets up three state enterprises, one to participate in the upstream, alongside with companies like Exxon, one to focus on infrastructural development and one to focus on marketing of products… our new production-sharing contracts in Trinidad allow the ministry to market their own hydrocarbons,” he said.

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Venezuela, Trinidad Review Joint Projects

Officials from Venezuela and Trinidad & Tobago during their meetings in Caracas. Source: PDVSA

(Energy Analytics Institute, Piero Stewart, 29.Jun.2018) – A delegation from Trinidad & Tobago traveled to Venezuela to discuss joint projects and gas related issues.

The meetings were aimed at guarantying the supply of Venezuelan natural gas to the Trinidad & Tobago domestic market, announced PDVSA in an official statement. The officials also discussed plans for gas trading in foreign markets.

Venezuela’s Oil Minister and PDVSA President Manuel Quevedo hosted the meetings.

The Trinidad & Tobago delegation consisted of Stuart Young, Minister of Procurator’s General Office and Legal Matters; Selwyn Lashey, Minister of Energy and Energy Industries; Mark Loquan, President Gas National Company and finally Paul Byam, Trinidad & Tobago Ambassador in Venezuela.

Other Venezuelan officials present during the meetings included: Venezuela’s Vice Minister of Gas, Douglas Sosa as well as Nemrod Contreras, Vice President of Gas.

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India to Provide $51 Mln Development Aid to Suriname

(PTI, 21.Jun.2018) – India will also extend a Line of Credit of USD 27.5 million to support a power transmission project in PikinSaronarea and another Line of Credit of USD 3.5 million for maintenance of Chetak helicopters.

Paramaribo: India will extend a Line of Credit of USD 31 million and a concessional financing of USD 20 million to Suriname as the two countries agreed to strengthen their economic relations and development partnership after President Kovind held talks with his Surinamese counterpart Desire Delano Bouterse.

President Kovind, who is on a three-day visit to the Latin American country, announced that India will extend concessional financing of USD 20 million for setting up a solar project to provide clean energy to a cluster of 49 villages in Suriname.

India will also extend a Line of Credit of USD 27.5 million to support a power transmission project in PikinSaronarea and another Line of Credit of USD 3.5 million for maintenance of Chetak helicopters.

The president also received the Ratification Instrument of Suriname joining the International Solar Alliance from Bouterse.

India also agreed to assist Suriname to establish a Centre of Excellence in information technology. An MoU to take forward this project was signed.

Besides, the two sides also concluded four MoUs in the fields of elections, diplomatic academies partnership, employment for spouse of diplomats of the two countries and archives.

Suriname invited Indian investment in areas such as agriculture, mining, energy and timber.

During the talks, Suriname accepted India’s invitation to attend the 11th World Hindi Conference to be held in Mauritius in August 2018 as well as the Business Conclave to be held between India and CARICOM in Trinidad and Tobago soon.

Addressing the National Assembly of Suriname, Kovind, who arrived here on June 19 on the second leg of his three-nation tour to Greece, Suriname and Cuba, said development cooperation, under the rubric South-South cooperation, is an important pillar of Indo-Surinamese relations.

Kovind was the first foreign Head of State to address the National Assembly of Suriname. In 1988, then Vice-President of India Shankar Dayal Sharma had addressed the House.

“Paramaribo and New Delhi are almost 14,000 km apart. Yet, despite this trans-oceanic gap, our countries have much in common. Both Suriname and India are multi-cultural, multi-religious and multi-ethnic democracies,” he said.

Speaking on the climate change, he said, “This is an international concern, a foreign policy issue – and yet, for the people of Suriname it is a deeply-felt existential challenge. I must commend your country for its enlightened approach on climate change. You have shown a determination that even much larger and wealthier nations have shied away from.”

Kovind said India has extended financial grants for a craft market project and a digital literacy programme.

“We hope our assistance will help in promoting economic sustainability and capacity building of women and children in Suriname,” he said.

He said India wants to strengthen our capacity building partnership with Suriname through the Indian Technical and Economic Cooperation programme as well.

“We have, therefore, offered to raise the annual scholarships to Suriname under the programme from 40 to 50,” he said.

Kovind said that President Bouterse has expressed Suriname’s continued support for India’s aspiration to be a permanent member of the UN Security Council.

“We also expressed our deepest concern on the threat posed by terrorism and conveyed strong support to each other to fight the global menace,” he said.

India and Suriname also agreed to enhance cooperation to promote Ayurveda and other traditional medicinal systems of both countries.

Suriname has been celebrating 145 years of arrival of Indian diaspora to the country and Kovind’s visit coincided with the celebration.

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Jamaica Encouraged by 3D Oil, Gas Surveys

(Amsterdam News, Bert Wilkinson, 24.May.2018) – Jamaica is fancying its chances of becoming the latest Caribbean Community nation after Guyana to find commercial quantities of oil and gas in the wake of encouraging indications from the most recent round of offshore surveys.

Jamaican authorities said on the weekend that they were upbeat about the results of three dimension offshore surveys aimed at determining whether the northern Caribbean island nation will remain as a net importer rather than a producer of oil and gas.

The Petroleum Corporation of Jamaica said the 3D program run by Tullow Oil of the United Kingdom marked the first time that such high-tech surveys were done anywhere in island waters, and the signs are good for further investment.

“Tullow’s decision to do the 3D seismic survey shows that the data indicators are pointing in the right direction, and we hope that the results of the post-survey data analysis will prompt them to move forward to the next phase,” said Winston Watson, group general manager of the PCJ.

Encouraged by consistent seepages of live oil both on and offshore in Jamaica in recent months, Tullow and the PCJ decided to step up exploration and survey work, convinced that commercial quantities of both oil and gas lie below the seabed and on land in Jamaica.

Late last year, local fishermen pointed authorities to live oil on top of the water off Jamaica’s south coast. Initially, the seepage was dismissed as waste oil either from cruise or other commercial ships operating in or passing through Jamaican waters.

But the fishermen insisted that the oil was new, fresh and recurring, so authorities decided to take a second look, and Tullow unpacked its equipment and started work anew.

Weeks later, inland in northern Jamaica, locals also pointed officials to seepages. Experts investigating the seepages discovered that the two were a mere 47 miles apart, which suggests that there might be an active system underground.

The PCJ’s Watson said, “The 3D seismic survey, Jamaica’s first, is the most advanced oil-and-gas exploration study ever carried out in Jamaica, and its completion marks the steady progress of the exploration PSA the PCJ signed with Tullow in 2014.”

The study area, The Gleaner newspaper reported, covered 2,250 square kilometers, and the survey ran for 45 days.

Jamaica’s efforts to determine whether it has commercial quantities of oil and gas come amid a mad rush by Caribbean nations such as Guyana, Grenada, Barbados and Suriname and also the Bahamas to become oil producers.

U.S. giant ExxonMobil is preparing for a late 2019 or early 2020 production startup in Guyana. Grenada’s government in March said that recent surveys prove the island, close to oil and gas-rich Trinidad, has commercial quantities that will be developed in the coming years.

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Dominican Republic to Join Caribbean Energy Rush

(Bloomberg, Ezra Fieser, 5.Mar.2018) – The Dominican Republic expects to draw interest from energy titans BP Plc and Exxon Mobil Corp. when it opens the country to natural gas and oil exploration for the first time later this month, joining a push by governments across the Caribbean to develop energy production.

The government plans to open two land blocks for oil exploration and two offshore blocks for natural gas exploratory drilling by the end of March, said Energy and Mining Minister Isa Conde in an interview in Santo Domingo. An Exxon spokeswoman said in an email that the company does not comment on future business plans. BP did not respond to an email seeking comment.

“This is completely virgin territory for us,” Conde said. “But we would not be going forward if we had not received assurances from international companies and investors that there was substantial interest.’’

Developing the industry would give the nation of 11 million another source of foreign exchange earnings and allow it to cut its fuel import bill, Conde said. Although few Caribbean islands have developed significant commercial production outside of Trinidad & Tobago, a top exporter of liquefied natural gas in the Americas, the region is rapidly drawing interest from energy companies.

Exxon is leading a group of companies developing 6.6-million-acres in Guyana’s waters that could make the country one of Latin America’s largest oil producers within a decade. That discovery has spurred interest in neighboring Suriname, while the government in the Bahamas is also opening offshore areas for exploration. In Jamaica, CGG GeoConsulting and the Petroleum Corporation of Jamaica said last month they had discovered oil seeps in two separate parts of the island.

Seismic study

The Dominican government does not have an estimate of the reserves and Conde said any production could be years away. A two-year seismic study found six areas that potentially hold light and heavy crude or natural gas. If the areas prove commercially viable, the government will likely demand production contracts in which it continues to own the land, he said.

The $72 billion economy is forecast to grow 4.5 percent this year, the most in Latin America after Panama, according to economists surveyed by Bloomberg.

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PDVSA’s Deterioration on All Fronts

(Energy Analytics Institute, Pietro D. Pitts, 22.May.2017) – In recent weeks PDVSA has reported at least three accidents: Petrotrin oil spill in Sucre state and incidents at its Cardon and Curaçao refineries.

The writing on the wall continues to point to a cash-strapped state oil company with an inability to make investments, retain top talent, organically grow oil production, and let alone take on the leadership role in Venezuela’s upstream, downstream, or midstream sectors. The stand-alone events at PDVSA’s Cardon and Curaçao refineries demonstrate conditions at the company’s refineries continue to deteriorate as expected due to a lack of investments, upgrades and maintenance by the state oil entity.

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PDVSA, Shell Discuss Gas Exports

(Energy Analytics Institute, Piero Stewart, 21.May.2017) – PDVSA and Shell continue to conduct discussions related to the exportation of Venezuelan natural gas to the twin-nation island of Trinidad and Tobago, reported PDVSA in an official statement.

“We are evaluating the base of resources for export,” announced PDVSA, citing PDVSA Gas President César Triana. “We have received proposals to finalize the accelerated production project and future development of the field to boost export volumes to the Caribbean nation,” she said. Discussions between the companies were headed by PDVSA President Eulogio Del Pino and PDVSA Gas President Cesar Triana and Shell Venezuela and Trinidad President Luis Prado.

Discussions between the companies teams focused on three aspects: gas volumes, gas prices and the field interconnection point. An earlier agreement signed by the companies entails construction, operation, and maintenance of a gas pipeline to transport the fuel source between both nations and span from the Dragon field located in Sucre state to the Hibiscus field in Trinidad. The project is estimated to have achieved the 91% completion mark, PDVSA reported.

Paria North — where the gas will come from — contains 14.3 trillion cubic feet (Tcf) of gas reserves in four fields: Dragón, Patao, Mejillones and Río Caribe. The Dragón field alone contains 3.1 Tcf, according to PDVSA.

Discussions also focused on the flaring of gas in North Monagas and future recollection of this gas and other general themes related to the Petroregional del Lago mixed company. The initial volumes from the Dragón field will be destined for the Venezuelan domestic market to substitute the use of diesel at thermo-electric plants, and is estimated to free up 32,000 barrels per day of fuel.

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PDVSA Says Oil Spill Clean-up Advances

(Energy Analytics Institute, Piero Stewart, 20.May.2017) – PDVSA announced that clean-up activities continue along the Venezuelan coast off Sucre state, related to the spill of crude oil at the Pointe-à-Pierre refinery in Trinidad and Tobago, reported the state oil co. in an official statement.

After reviewing clean-up activities along the Paria Peninsula, PDVSA President Eulogio Del Pino announced Venezuela had removed 80% of the spill fuel.

“We flew over Cocal, Pata, and Puerto Hierro beaches as well as Pato Island and observed that the clean-up process is above 80%,” said Del Pino. “The remaining impact is minimum.” We have removed 80% of the fuel from the spill that had reached La Caracola beach in Margarita Island, said Del Pino. Oil also reached Los Roques; however, the impact was minimum, PDVSA reported.

PDVSA is awaiting a visit from Petrotrin to discuss the oil spill. “Petrotrin [officials] will visit all the affected areas,” said Del Pino.

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Trinidad Oil Spill Reaches Venezuelan Beaches

(Energy Analytics Institute, Aaron Simonsky, 13.May.2017) – PDVSA has intensified contingency measures to counter the ill effects of an oil spill that occurred last week in neighboring Trinidad and Tobago.

Oil from the spill has reached the Venezuelan eastern coast including the Bay of Morro de Puerto Santo and Cipara beach in the Arismendi municipal in Sucre state as well as other coastal areas such as La Caracola in Valdez beach, Punta Ballena and El Ángel, all located in Nueva Esparta state, announced PDVSA in an official statement.

PDVSA’s Zone 5 Contingency Plan was activated on April 25, 2017 to counter the leakage of fuel oil from Petrotrin’s Pointe-à-Pierre Refinery located in Trinidad. PDVSA personnel continue to conduct maritime and aerial inspections along the areas affected by the spill and primarily of the Paria Peninsula in Sucre state and the southern area of Nueva Esparta state. PDVSA did not provide estimates as to how much oil may have reached Venezuelan coastal regions nor did it provide details of the potential environmental impact of the leakage.

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Guyana’s Initial Oil Output to Surpass Trinidad

(Energy Analytics Institute, Pietro D. Pitts, 2.Mar.2017) – Sleepy Guyana is gearing up to surpass twin-island nation Trinidad and Tobago in terms of oil production.

Production plans by Irving, Texas-based Exxon Mobil Corporation at the promising Stabroek Block offshore Guyana will assist the small country to initially produce more oil than its Caribbean neighbor Trinidad, which has been producing oil for over a century.

Exxon — which plans to make an investment decision later this year regarding finds at the Stabroek Block, including the Liza, Liza deep and Payara wells – expects production of 100,000 barrels per day in 2020 in the initial phase using a Float Production, Storage and Offloading (FPSO) unit, said Jeff Woodbury, Exxon Mobil Vice President of Investor Relations during a conference call on January 31, 2017.

“Guyana is to become the newest petrostate. It has two neighbors from which to learn what to do, Trinidad, and what not to do, Venezuela,” Francisco J. Monaldi, Ph.D. and Fellow in Latin American Energy Policy & Lecturer in Energy Economics at Rice University’s Baker Institute for Public Policy wrote in a twitter post.

The Stabroek Block covers 6.6 million acres (26,800 square kilometers). The operator of the block is Esso Exploration and Production Guyana Limited with a 45 percent interest. Other partners in the block include: Hess Guyana Exploration Ltd. with a 30 percent interest and CNOOC Nexen Petroleum Guyana Limited with a 25 percent interest.

Trinidad produced an average of around 72,000 barrels per day in the eleven months between January and November of 2016, according to data published in a bulletin by the country’s Ministry of Energy and Energy Industries.

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Venezuela Eyes Boosting Hydrocarbons Economic Driver

(PDVSA, 26.Jan.2017) – Members of the Hydrocarbons Economic Driver of the Bolivarian Economic Agenda, met at La Campiña headquarters of PDVSA in Caracas, for the presentation of the first annual report.

The first session of 2017 was attended by more than 30 representatives from the Bolivarian Federation of Energy and Oil (FEBEP), Venezuelan Oil Chamber (CPV), Venezuelan Hydrocarbons Association (AVHI), Venezuelan Gas Processors Association (AVPG), Federation of Small and Medium Size Industries and Artisans (Fedeindustria), and Covencaucho.

“This was one of the economic drivers with the most activity, dynamism and results; it was extremely productive,” said Eulogio Del Pino, president of PDVSA and coordinator of the hydrocarbons sector. He said the agenda is already set for the first four meetings which will focus on each of the sectors that are particularly important for the hydrocarbons sector, on a weekly basis.

He also announced key achievements, including $5 billion financing obtained for oil production joint ventures with the main partners, both national and international. Also, large scale projects continued, such as Puerto La Cruz Refinery’s Deep Conversion in the state of Anzoátegui, with an investment of more than $8 billion.

New joint ventures were created with the national private productive sector. “Traditionally, they had imported supplies which now we will produce in the country, such as grooved pipes. About eight of these companies are already in full production,” he said. And a discussion group is being formed to look at the production, supply and remand of lubricants.

“We signed export agreements with our neighboring countries and strengthened our efforts geared at the Caribbean refineries where we have operations, including Aruba and Curacao. We also held binational events with Trinidad and Tobago, specifically in the border areas where we have common reservoirs,” he said.

Del Pino said that the meeting was productive. “It definitely means that 2017 will be of great boost and advance.”

Debt reduction

For the president of PDVSA, reducing PDVSA’s financial debt in an economically difficult year was particularly important. This was possible thanks to the bond swap and timely payments.

“We were required to publish our consolidated debt before January 20. Currently, the debt is down by $2.7 billion from the previous year,” Del Pino said.

Finally, he spoke about new financing strategies and novel oil industry hiring schemes which contributed to positive results, and indicated that PDVSA lowered costs by 30%, which is fundamental for the Venezuelan economy.

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Trinidad and Venezuela Reach Deals

(Energy Analytics Institute, Piero Stewart, 5.Dec.2016) – Together with President Nicolas Maduro and Prime Minister of Trinidad Keith Rowley we reached historic energy agreements, wrote PDVSA President Eulogio Del Pino in a series of twitter posts.

“Together with Shell Venezuela we agreed to start negotiations to obtain financing for Petroregional del Lago, S.A.,” wrote Del Pino.

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Venezuela to Export Gas to Trinidad

(PDVSA, 5.Dec.2016) – During a meeting in Miraflores Palace, the People’s Power Minister of Petroleum and President of PDVSA Eulogio Del Pino and the Prime Minister of Trinidad and Tobago Keith Rowley, signed an agreement to implement the Natural Gas Supply Project from Venezuela to Trinidad and Tobago through a gas interconnection from the Dragon Field in northeastern Venezuela.

This agreement will boost gas production and exports, as Venezuela continues with its policy of strategic alliances. Through this partnership, one or more gas pipelines will be built from the Mariscal Sucre area in Venezuela to Trinidad and Tobago.

The interconnection to export gas will be established from the Venezuelan Dragon Field to the Hibiscus platform in Trinidad and Tobago. Another potential route will be evaluated from Güiria, in Sucre state, to Point Lisas in Trinidad.

Decade for energy integration

For President Nicolás Maduro, this strategic alliance makes a reality a decade of Latin American and Caribbean integration.

“We are working on our maritime borders with blocks of gas. We have reached agreements for their joint exploitation, taking advantage of the strengths of both nations for a win-win. This is what we call Bolivarian Peace Diplomacy. Through a dialogue we seek to develop common interests,” Maduro said.

He asked Minister Del Pino to accelerate implementation and investment on these projects.

Historic development

Prime Minister Rowley described the signing of the agreement as a historic development that will improve relations between the two nations.

“Today’s development marks a commitment to develop face to face, holding onto opportunities that are beneficial to the people of Venezuela, to the people of Trinidad and Tobago and the wider Caribbean,” Rowley said.

The prime minister believes the agreement will open opportunities for various “significant and necessary commercial developments in the hydrocarbons sector.”

 

“These units of commerce open doors towards a staircase upon which Trinidad and Tobago can walk confidently into the international marketplace…We look forward to climbing these stairs, side by side with Venezuela as we enjoy the benefits of our petro Caribbean basin,” concluded Rowley.

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Venezuelan Officials Visit with T&T’s Rowley

(Energy Analytics Institute, Piero Stewart, 8.Oct.2015) – A Venezuela delegation is expected to visit with Trinidad and Tobago Prime Minister K. Rowley, Venezuela finance minister Rodolfo Marco Torres writes in twitter post.

The Venezuela delegation could be comprised of Torres, Foreign Minister Delcy Rodriguez, and Oil Minister Eulogio Del Pino.

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Guyana To Assure No Fuel Shortages

(Guyana Government Information Agency, 4.Sep.2015) – The government of Guyana believes that its responsibility and obligation are to ensure that there will be no shortage of fuel in Guyana, and so must do everything possible to keep the wheels of industry turning. This is according to Minister of State, Joseph Harmon, who stated that is against this background that the agreement to purchase fuel from Trinidad and Tobago was made.

“It is the government’s commitment to ensure that there is a reliable and regular supply of fuel, to drive industry in this country, and we as a government will do what is necessary in the public interest, to ensure that the wheels of industry continue to turn,” Minister Harmon told media operatives, at his post Cabinet press briefing.

According to Harmon, Cabinet was briefed on this matter by the Minister of Public Infrastructure, David Patterson. Guyana has been purchasing fuel from Venezuela under the PetroCaribe arrangement, but there have been occasions when shipments arrived late.

“A few weeks ago, the vessels that had gone to Venezuela to collect fuel, they were not provided with the fuel on time, and this type of ‘on and off’ arrangement, we have to ensure that we have an alternative arrangement put in place, to ensure that this will not lead to a shortage of fuel in Guyana,” Harmon said.

According to Harmon, fuel was already purchased form Trinidad and Tobago. “We have both arrangements in place, a standby arrangement, which we will utilize from Trinidad and Tobago, and the PetroCaribe arrangement, which is in place by contract,” he explained.

Questioned on the feasibility of the new arrangement, Harmon said, “We do not see or feel that this arrangement will put in jeopardy any of the users of petrol/fuel in the country, in fact, it is feasible, the terms are very favourable for us and I believe that we have a commitment from that country for the supply of petrol. The financial arrangement is no less favourable than that which we receive under the PetroCaribe agreement.”     Trinidad and Tobago is aware of Guyana’s arrangement with Venezuela through the PetroCaribe agreement. In the event there is a shortfall or a problem with that agreement, the Trinidad facility will be there to cushion the effect.

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Life in a Venezuelan Oil Camp: Tío Conejo Meets Uncle Sam

(Harvard Review of Latin America, Miguel Tinker Salas, 14.Aug.2015) – I grew up in a Venezuelan oil camp. Ever since I can remember, I have heard both Spanish and English spoken all around me or conveyed through music or films. With my family, I ate traditional Venezuelan arepas, cachapas, carne mechada (shredded beef), fried plantain, and black beans, but invitations to dinners at friends’ houses often meant sampling curry goat, roti and thali, borscht, or U.S.- style barbecues.

In many ways, Caripito, the oil town where I was raised, embodied the changes occurring throughout Venezuela after the discovery of oil. In 1930, the Standard Oil Company of Venezuela built a port facility and began work on a refinery in this town, in the state of Monagas in eastern Venezuela, to process oil from fields in Quiriquire, Jusepin and Temblador. The promise of the oil attracted Venezuelans from throughout the country; many caripiteños (people of Caripito) had roots in the adjacent state of Sucre. In succeeding decades, people from Trinidad, Italy, Lebanon and even a handful of Russian exiles also made their way to Caripito. By 1939, Caripito had a population estimated at about 5,000 people, some 300 of whom were “white Americans.” In Caripito, as in most oil camps, to be white increasingly became synonymous with being a U.S. expatriate. By 1960, the total population had soared to a little over 20,000 people.

At an early age I became acutely aware of how different the oil camp experience was from the rest of Venezuela. After several years of living in the residential enclave, and seeking to avoid the demanding social expectations of the camp, my parents moved to Los Mangos, a neighborhood of Caripito. However, they also recognized the importance of straddling both worlds, and my mother dutifully drove me everyday to the company school and our family selectively participated in many camp activities.

After oil was discovered in 1914, Venezuelan production was concentrated in the interior of the country, where infrastructure and sanitary conditions had improved little since the 19th century. To ensure operations, foreign companies took charge of basic services including electricity, water, sewage, roads, housing, health services, schooling and a commissary. In these rural areas, the companies supplanted the state, and local communities became dependent on foreign enterprises for basic services.

Standard Oil Company of Venezuela (later  Creole Petroleum, a subsidiary of Standard Oil Company of New Jersey), and Shell Oil built residential camps to house their employees. In classic Jim Crow fashion, the companies created distinct areas for foreigners, typically white U.S. employees or “senior staff,” Venezuelan professionals or “junior” staff, and more modest housing for workers. The senior staff clubs included a pool, golf course, tennis and basketball courts, as well as bowling alleys while the workers club typically had a baseball field, a bolas criollas court (bocce), a bar and a dance floor. In spite of this hierarchy, by the 1950s the camps became symbols of U.S.-sponsored “modernity,” with orderly communities, higher salaries and access to a full range of services that sharply contrasted with conditions found in the local Venezuelan settlements.

The camps represented an improvised and largely transitory society made up of residents from different parts of the United States and Venezuela. The camps allowed Venezuelans to interact with people from other regions, races and countries. With few if any roots to the local community, workers were frequently transferred between camps, and the company promoted an esprit de corps among its employees that centered on an all-encompassing corporate culture. Company practices favored hiring family members, thus handing down values such as the “American way of life” from generation to generation.

Yet despite their artificial nature, the camps left an enduring legacy in Venezuelan culture and society. For the generations that worked in the oil industry, the camps reinforced their image as a privileged sector of Venezuelan society. Just as importantly, the camps were sites of cultural and social exchange, with the “American way of life” influencing everything from politics to values. Those employed in the industry expected the Venezuelan state to be the guardian of this distinctive lifestyle.  Many residents retained a collective nostalgia for the experience of the camps, overlooking the racial and social hierarchy that prevailed and the detachment that existed from Venezuelan society.

Caripito was typical of this oil town culture. The same ships that navigated the San Juan River to load oil also brought an array of U.S. fruits and canned products for sale in the camp commissary. I still recall the amazement of eating individually wrapped red Washington apples for the first time, or savoring crisp Mexican tortillas that came in vacuum-sealed metal cans.  Long before McDonalds appeared in Venezuela, the soda fountain at the company club regularly served the “all American meal” consisting of hamburgers, fries, and Coke. The Venezuelan diet quickly incorporated U.S. culinary preferences and tastes.

Like other children in the camps, I went to a bilingual company school that incorporated both the Venezuelan and U.S.-mandated curriculum. To a certain extent, exposure to a bicultural milieu shaped the consciousness and personal sensibilities of people like myself who inhabited the camps or its environs. Beyond simply the ability to speak both languages, the camps conveyed the importance of dealing with difference. This experience, however, was not shared equally, and it usually fell on the Venezuelans to learn English. Besides understanding English, familiarity with U.S. norms and customs proved essential for Venezuelans seeking to advance in the company. Interacting with foreigners became natural, but so did the imposition of a social racial hierarchy reinforced by U.S. expatriates at the top of the social order.

Festivities in oil camps highlighted the extent to which the camps represented self-contained enclaves of U.S. culture in the heart of Venezuela. Seldom if ever questioned, the pervasive influence of the U.S. oil industry made political and cultural ties with the north appear normal.  Celebrations of the 4th of July melded with Venezuelan independence on the 5th of July, becoming shared events that allowed politicians and company officials to make largely perfunctory claims of solidarity.  Expatriates, especially from Texas, saw the occasion as an opportunity to prepare Southwest-style barbecues where local beer flowed freely. Uncle Sam, the benevolent father figure that later morphed into a symbol of U.S. imperialism, mixed freely with Tío Conejo, a shrewd rabbit from a Venezuelan folk tale who regularly outwits his tiger nemesis, Tío Tigre.

Other festivities, however, diverged from Venezuelan traditions for which no parallel activity existed.  During Halloween, children dressed as Mickey Mouse, cowboys, ghosts and witches wandered throughout the senior camp asking for candy from befuddled Venezuelans.  Thanksgiving celebrations by the U.S. expatriate community, which often included public gatherings, and the consumption of frozen turkeys imported from the United States, remained an exclusively foreign activity. Venezuelans outside of the oil industry had no connection to these events. A traditional Christmas in Venezuela had always included building a Nativity scene, but in the oil camps, this practice was slowly displaced by ornament-laden imported pine trees. To add to the festive mood, the oil company typically decorated a nearby oil well or water tower with colored lights in the shape of a Christmas tree, with adjacent loudspeakers playing seasonal melodies.

Shortwave radios allowed expatriates—and some oil camp Venezuelans—to keep track of events in the United States and important news quickly spread. This was long before the Internet or cable television made speedy news a fact of life. I can recall seeing my U.S. teacher at the Cristóbal Mendoza grammar school break down in tears when the school loudspeaker announced the assassination of President John F. Kennedy.

Another way of connecting to U.S. culture was through movies shown at the camp club; Spanish subtitles allowed the Venezuelan audience to follow the action without paying second thought to the overt racism present in many of the U.S. Westerns that stereotyped Mexicans and Native Americans. Many of my U.S. classmates at the camp shared LP records that came with a coonskin cap, plastic musket, and powder horn and recounted the exploits of Davy Crocket starring Fess Parker.
Venezuelans who did not live in the camp or work in oil sought entertainment in the San Luis movie house in La Sabana across from the Creole Petroleum refinery. I straddled both worlds, and loved to watch Mexican cowboy (charros) films or the comedy of Cantinflas and Tin Tan in the old-fashioned movie house that featured a range of seating from common wooden benches to higher-priced chairs. Outside the theater, my friends and I looked forward to savoring corn empanadas de cazón (dried shark), a local favorite in eastern Venezuela, made by an Afro-Venezuelan woman.

The importance of oil to the U.S. economy and military thrust Venezuela into the midst of the Cold War. In 1962, Peace Corp volunteers were assigned to Caripito to teach English in secondary schools and promote U.S. values. In case their efforts failed, Green Beret advisors gathered intelligence and trained the Venezuelan National Guard. In 1962, guerrillas launched an offensive in eastern Venezuela. The U.S. military advisors assigned to Caripito asked my local Scout troop to report on “suspicious activity,” including spent cartridges we might find as we hiked through the rainforest. To assuage discontent, the town’s poor also received sacks of grain from the Alliance for Progress and from Caritas, a Catholic charity. As I accompanied my parents into some of the poorest neighborhoods of Caripito to distribute food packages it became evident that oil had not benefited all sectors of society equally. The camps highlighted the existence of two Venezuelas, one benefiting from oil, and one for which the promise of oil remained elusive.

Oil never fully transformed Venezuela, but rather it created the illusion of modernity in a country where high levels of inequality persisted.  The camps became a tangible symbol of this disparity. Local residents resented the inequities in lifestyle; businesses complained about closed markets; the government worried about divided loyalties; and the left viewed them as part of U.S. exploitation of Venezuela’s labor and resources. During the 1970s, popular protest singer Ali Primera wrote Perdóname Tío Juan (Forgive me Uncle John):

Having successfully created a trained and acculturated labor force imbued with company values, even the oil companies believed the camps had outlived their usefulness. Despite their eventual integration into local communities, the lived experiences of those employed in the industry coalesced with the perspectives of mid dle- and upper-classes that viewed oil as the guarantor of their status. Attempts to recapture the illusory sense of modernity experienced during this period inform many of the political divisions that characterize contemporary Venezuela.

Es que usted no se ha paseado
por un campo petrolero/ usted no ve que se llevan
lo que es de nuestra tierra/
y sólo nos van dejando
miseria y sudor de obrero/
y sólo nos van dejando/
miseria y sudor de obrero.

(You have not visited an oil camp, you do not see that they take what belongs to our land, and all they leave us is misery and the sweat of our worker’s and all they leave us is misery and the sweat of workers.) 

Miguel Tinker Salas is Professor of Latin American History and Chicano/a Latino/a Studies at Pomona College in Claremont, California. He is the author of Venezuela, What Everyone Needs to Know (Oxford University Press, 2015) and The Enduring Legacy: Oil, Culture and Society in Venezuela (Duke University Press, 2009), among other books.

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Venezuela Eyes Gas Exports, Floating LNG

(Energy Analytics Institute, 18.Jun.2015) – Petroleos de Venezuela SA (PDVSA) plans to boost investments in the Venezuelan natural gas sector over the next five years in order to almost double production to meet increasing domestic demand, reduce its reliance on fuel imports and eventually export excess gas volumes to generate additional dollar income.

PDVSA, as the state oil company is known, plans capital investments of $38.4 billion during 2015-2019 to increase natural gas production from 7.4 Bcf/d in 2014 to 10.5 Bcf/d by 2019, said PDVSA official Douglas Sosa on June 18, 2015 during a hydrocarbon congress in Maracaibo, Venezuela. Increased gas production will assist PDVSA met increasing demand in the domestic market and reduce its dependence on costly refined product imports. Excess gas production could be destined for export markets in Latin America as well as Trinidad.

“We are talking about exports to Trinidad, Central America, South America and if we consider the LNG projects that we are promoting we could export this gas to further destinations,” said Sosa.

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