June 22, 2017 / 6:41 PM / 6 months ago

Venezuela's PDVSA to buy up to 17 fuel cargoes on the open market -tenders

HOUSTON (Reuters) - Venezuela’s oil company PDVSA is seeking to buy up to 6.32 million barrels of fuel in one of its largest offers on the open market in recent years, according to documents seen by Reuters on Thursday.

The firm, whose refining network is working at record lows since March due to lack of light oil, equipment malfunctions and other incidents, has increased fuel purchases this year to avoid gasoline shortages in the country.

The 17 fuel cargoes of gasoline blendstock, ultra-low sulfur diesel (ULSD), catalytic naphtha, vacuum gasoil (VGO) and components for motor gasoline are expected to be received from July through December, the tender documents say.

Earlier this month PDVSA awarded a group of firms, including Russia’s Lukoil, previous tenders to buy 600,000 barrels of VGO and 300,000 barrels of gasoline blendstock RON 95 for July delivery.

The Venezuelan state-run company is this time requesting 600,000 barrels of gasoline blendstock RON 91 and 95, up to 900,000 barrels of ULSD and 600,000 barrels of catalytic naphtha for delivery July 1-20 at any of its ports.

It is also seeking up to seven 500,000-barrel cargoes of VGO and 720,000 barrels of MTBE (Methyl Tert Butyl Ether) from July through December.

Some cargoes are to be paid 35 days after discharge. For other cargoes the company is willing to arrange oil swaps under a mechanism known as “offset.”

Venezuela is a prominent oil producer, but its crude output has declined in recent years. Its 1.3 million-barrel-per-day refining network needs maintenance and a larger volume of light oil that the South American country does not produce.

The Cardon refinery’s catalytic cracker resumed normal work this week after reduced functioning. But PDVSA’s largest refinery, Amuay, and the smaller Puerto la Cruz refinery are working partially.

As of the end of last week, about 18 tankers carrying crude and fuels for PDVSA were waiting around its ports to be paid to authorize discharge, according to Reuters vessel tracking data.

Reporting by Marianna Parraga; Editing by Toni Reinhold and Dan Grebler

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