CARACAS May 27 Venezuelan state oil company
PDVSA on Monday signed an agreement to receive a $2 billion loan
from U.S. oil giant Chevron to finance a 16 percent
increase in production capacity at the Petroboscan heavy crude
joint venture in western Venezuela.
The widely expected and long-delayed deal follows similar
financing arrangements for nearly $9 billion this year with
joint venture partners that include Russian and Chinese firms.
"We will begin to receive these resources immediately. They
will be used for infrastructure and management to boost
production as soon as possible," said Oil Minister Rafael
Ramirez, who signed the agreement with Chevron Latin America
President Ali Moshiri.
The funds will help boost capacity at Petroboscan to 127,000
barrels per day from 107,000 bpd by 2019. The loan has an
interest rate of Libor plus 4.5 percentage points and is to be
repaid in 2026.
The two sides negotiated the loan over two years. Its
signing was delayed by last-minute changes requested by
Venezuela and by former Venezuelan leader Hugo Chavez's illness
PDVSA in recent months has signed financing deals with other
companies, including Russia's Rosneft and China's
CNPC to boost output at joint venture agreements.
Oil services giant Schlumberger last week agreed to give
PDVSA a $1 billion credit line to continue using its services
amid growing debts from unpaid bills.
The agreements may help PDVSA avoid the heavy bond issuance
of recent years even as it transfers billions of dollars to the
government for social spending programs created by Chavez.
Chevron is a 40 percent partner in Petroboscan, with PDVSA
holding the remaining 60 percent.
The U.S. oil major is also a partner in the Carabobo 3
project in the Orinoco extra-heavy oil belt, considered one of
the world's largest crude deposits, in eastern Venezuela.
PDVSA hopes to boost output by 400,000 bpd this year to
reach 3.3 million bpd by investing a record $25 billion, with
focus on six new Orinoco belt projects.
Chavez for years used PDVSA to finance heavy social
spending, building up his popular support but spurring criticism
that the company was not investing enough in operations.