August 11, 2009 / 4:30 PM / 10 years ago

Putin pledges modern oil technology for Venezuela

*Venezuela’s Energy Minister Ramirez meets Russian PM Putin *Putin promises modern technology for Venezuelan oil fields

By Gleb Bryanski

SOCHI, Russia, Aug 11 (Reuters) - Russia will use the most modern oil extraction and processing technology if it wins access to Venezuela’s oil deposits, Prime Minister Vladimir Putin told a Venezuelan official delegation on Tuesday.

Venezuela’s state oil company PDVSA and a consortium of Russian firms expect next month to present a joint venture that aims to develop the Junin 6 block in the Orinoco oil belt, which Venezuela says has the world’s largest hydrocarbon reserves. [ID:nN27541750]

A delegation headed by Venezuala’s Energy Minister Rafael Ramirez flew to the Russian resort town of Sochi where Putin is spending his holiday and visited a refinery operated by oil major Rosneft (ROSN.MM), which is a member of the consortium.

“I was really impressed by the quality of this refinery and technology which is being used there. This is what had always pleasantly surprised me in Russian companies,” Ramirez told Putin.

“If we will work in Venezuela and realise all our plans, the technology and equipment which will be used in Venezuela will be even more modern,” Putin said.

“The Russian companies will use the latest technology available in global markets,” Putin said.

A formal contract to jointly develop the Junin 6 block with an estimated production capacity of 200,000 barrels per day should be signed before the end of the year.

The Russian consortium includes Rosneft, Gazprom (GAZP.MM), LUKOIL (LKOH.MM), TNK-BP TNBPI.RTS and Surgutneftegaz (SNGS.MM). It also intends to bid for blocks in the Carabobo Project.

“Our companies are getting a possibility to work on a range of promising blocks. Our gas company Gazprom (GAZP.MM) also has good prospects,” Putin said.

Russia has been keen to build relations with a rival to the United States in the Western hemisphere, to counter U.S. influence in formerly Communist countries.

Putin sent his greetings to Venezuela’s President Hugo Chavez, calling him “our big friend”. He said Russia was also ready to develop its arms trade with Venezuela.

“We are ready to review offers and bids of Venezuelan partners also in this direction,” Putin said.

Russia and Venezuela signed a series of energy and military accords last month during a visit by Putin’s deputy Igor Sechin. The accords also included a creation of a joint bank.

Sechin, who oversees Russia’s energy policy and chairs Rosneft’s board, said previously that the consortium will need to build costly upgraders since the extra-heavy crude oil from the Orinoco has to be processed before it can be refined.

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