Iranian Condensate to Help Venezuela Boost Crude Production
In defiance of US sanctions, Iran and Venezuela continue to cooperate in the field of oil production.
A senior official at PDVSA told Reuters that the Venezuelan state-run oil company will use a cargo of Iranian condensate that arrived in the country last week to boost output at three key extra-heavy crude projects in its largest oil region.
The deal between PDVSA and the National Iranian Oil Company (NIOC) to swap Venezuelan heavy oil for Iranian condensate comes as diluent shortages impede PDVSA's ability to mix its tar-like crudes from the Orinoco oil belt for transportation and export.
Wills Rangel, a PDVSA board member and a union leader, said on Wednesday that the condensate would help boost crude output at oilfields associated with three of the company's largest projects, Petrocedeno, Petropiar, and Petrolera Sinovensa.
"There are many inactive wells due to a lack of diluents," Rangel said. "We will reactivate production."
Shortages in diluents; a major setback
The diluent shortage is the latest obstacle the OPEC nation's oil industry is suffering from, considering that it has seen production collapse due to years of underinvestment. Moreover, US sanctions have cut the company off from key trade partners, including former suppliers of diluents.
According to a PDVSA schedule, the Iran-flagged tanker Dino I, which brought 2.1 million-barrel cargo of condensate, began discharging its first parcel this week for the Petrolera Sinovensa project.
It is worth noting that Petropiar and Sinovensa are joint ventures between PDVSA and Chevron Corp (CVX.N) and China National Petroleum Corp (CNPET.UL), respectively. PDVSA is now the sole shareholder of Petrocedeno after its former partners, TotalEnergies SE (TTEF.PA) and Equinor ASA (EQNR.OL), exited the project in July.
Rangel estimated that Venezuela's total crude production mounts to 750,000 barrels per day (bpd), higher than its average 641,000 bpd it had reported to OPEC in August. Venezuelan officials say they aim to boost output to 1 million bpd by the end of the year.