Venezuela reportedly plans a ‘gas revolution’ to develop offshore reserves for domestic needs and liquefy natural gas for export by 2014, with the help of foreign partners.
Petroleos de Venezuela SA (PDVSA) plans to begin production of LNG in 2014, from as many as three plants after it boosts supplies for its home market, according to news from Bloomberg.
Venezuela is home to the largest gas reserves in South America and wants to extract more value from these, following a trend among resource-holding nations in using foreign partners to build LNG plants to reach markets too distant for pipelines.
The PDVSA will retain a majority stake in all three planned projects.
“We have a very aggressive strategy to develop the Orinoco Delta,” which contains untapped gas reserves, Ruben Figuera, General Manager of offshore joint ventures at PDVSA, told the World LNG Summit in Barcelona.
The country has 181.9 trillion cubic feet (5.1 trillion cubic meters) of proven gas reserves, or 2.9% of the world total, according to BP Plc’s Statistical Review of World Energy.
Figuera said he expects proved reserves to almost double in the future, to 340 trillion cubic feet, which would place the country fourth behind Russia, Iran and Qatar.
Qatar has become the world’s biggest supplier of LNG, overcoming its geographical distance from European and Asian markets. Russia is expected to export its first LNG in 2009, while Iran is struggling to find willing partners to build facilities.
Finding willing partners does not appear to be a problem for Venezuela, with Figuera noting at the Barcelona conference how he had no concerns that the project may be slowed by the many partners involved.
Galp Energia SGPS SA, Chevron Corp., Qatar Petroleum, Mitsubishi Corp. and Mitsui & Co Ltd. are to be minority partners in the first plant, with PDVSA taking a 61% stake. The plant will cost an estimated $6.41bn, with gas fed from the Loran field to the Cigma industrial complex.
The facility will produce 4.7 million tons of LNG per year.
The second plant will cost around $5.2bn and again, produce approximately 4.7 million tons of LNG, with PDVSA retaining a 60% stake in the plant. Its partners will be Energia Argentina SA, Galp, Mitsubishi, Mitsui and Itochu Corp and the gas will come from the Mariscal Sucre fields, it is thought.
A third plant would bring in Russia’s OAO Gazprom as a partner, alongside Petronas, Eni SpA and Energias de Portugal SA.