By Marianna Parraga
HOUSTON, March 4 Italy's Eni and
Spain's Repsol will start early production of their
offshore natural gas project in the Gulf of Venezuela with
state-run Venezuelan oil group PDVSA at the end of this year,
Eni's CEO said on Tuesday.
After finding more than 15 trillion cubic feet (TCF) of gas,
the group's Perla project would increase Venezuela's stagnant
gas production and reduce reliance on other fuels that have been
used since 2010 to generate electricity during an intermittent
"We are expecting to have early production at Perla project
by the end of 2014," Paolo Scaroni told reporters at the IHS
CERAWeek energy conference.
PDVSA had said previously said the project would extract its
first gas by the end of 2013, but its private partners had
warned that to have production ready and negotiate a sale price
in dollars with the state-run company would take time.
Scaroni said Eni and Venezuela's PDVSA are currently
producing "a few thousand barrels" of crude oil at the vast
Orinoco belt, the biggest crude reservior in the OPEC-member
country, after the companies started early production last year.
Production will keep increasing to reach some 50,000 barrels
per day (bpd) in coming years, he added.
The project, which includes building a new refinery, has an
extra heavy crude production capacity of 240,000 bpd, but along
with other projects in the area it is increasing production
slowly because of a lack of infrastructure and PDVSA's cash flow
problems, according to industry sources.
In Africa, Scaroni said Eni is producing 220,000-230,000 bpd
of crude in Libya after reaching 80 percent capacity. He said
the situation in Nigeria, which affected the company's quarterly
results at the end of 2013, "is not improving".
Stability in Libya would take longer to achieve than in
countries such as Tunisia and Egypt as the regime of former
President Muammar Gaddafi had destroyed the country's
institutions, he said.
"Transition in Libya will be much longer. The clock which is
ticking now is money," he said, referring to Libya's balance of
Eni's operational income fell 29 percent in the last quarter
of 2013 because of lower oil production in Nigeria and Libya.
The firm also said it would keep selling assets up to 2017.
But Scaroni said there were no plans to exit either country.
"Not at all, I never did (think about exiting Libya).
Nigeria neither, this is a legacy country for us and we have
been there since 1965," Scaroni said.