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Venezuela's PDVSA seeks 8 million barrels of crude in large tender

HOUSTON (Reuters) - Venezuela’s state-run oil company PDVSA has launched one of its largest oil tenders ever, seeking to buy some 8 million barrels of U.S. or Nigerian light crude for delivery from April through June, according to a document seen by Reuters on Thursday.

A general view of a crude oil importing port in Qingdao, Shandong province, November 9, 2008. REUTERS/Stringer

That would be about 90,000 barrels per day, more than the 50,000 bpd of crude PDVSA bought last year. Then, it purchased mainly African and Russian grades as diluents for its extra heavy oil output and processed them at its Caribbean refineries, according to sources and Thomson Reuters Trade Flows data.

If awarded, this and another open tender would double crude volumes purchased by PDVSA, which started importing crude in 2014 amid a decline of its own diluents output.

Since a backlog of vessels formed in late 2015 following payment delays to its suppliers, PDVSA has been struggling to find providers for prompt deliveries.

The cash-strapped firm is now proposing several payment mechanisms to oil and trading companies, including swaps, prepaid sales, letters of credit and open credit.

Crudes requested in the tender are U.S. West Texas Intermediate and Nigeria’s Qua Iboe and Brass River in 550,000 to 1 million barrel cargoes to be discharged at its Bullen Bay terminal in Curacao. Additional volumes could be supplied by mutual agreement.

ON THEIR WAY

PDVSA has a separate open tender to buy one to three cargoes, of 700,000 to 1 million barrels each, of Russia’s Urals crude with deliveries starting in April, a trader told Reuters.

The company received regular Urals crude cargoes from firms Rosneft ROSN.MM and Lukoil LKOH.MM during the second half of 2015.

As result of a previous tender for African oil, PDVSA will also discharge next week a 995,000-barrel cargo of Nigeria’s Brass River light crude, according Thomson Reuters data. The tanker Ridgebury Maryselena is expected to arrive in Bullen Bay on March 18.

PDVSA has also imported since January two 500,000-barrel cargoes of WTI shipped by its unit Citgo Petroleum. Last week it awarded a tender to firm Total TOTF.PA to buy a third cargo of the same grade for March.

Royal Dutch Shell RDSa.L, Norway's Statoil STL.OL, Total, Algeria's Sonatrach and trading firms Helsinge and Vitol have sold African oil to PDVSA since 2014. The state-run firm is also regularly importing some 2 million barrels per month of heavy naphtha to dilute its crude.

Venezuela’s crude production slightly decreased to 2.74 million bpd last year, the Petroleum ministry said.

Reporting by Marianna Parraga; Editing by Terry Wade and David Gregorio

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