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Suncor CEO: Despite government's oil-friendly stance, Suncor is not ready to accelerate output growth.
Suncor Energy's CEO said on Wednesday that the company is not ready to increase production plans, despite the large-scale reforms promised by the Alberta and federal governments to boost growth in Canada's petroleum industry. These comments highlight the uncertainty surrounding whether the federal government’s more friendly stance towards the energy sector will translate to increased company investment and a higher output for Canada, the fourth largest oil producer in the world. Suncor's outlook is unchanged since its investor day in March, Rich Kruger, CEO of Suncor, said during a conference call. He added that there's still work to be done to convert last month's Memorandum of Understanding between the oil-sands industry, and government, into legislation. Kruger stated that it is still unclear how the agreement will affect his plans. Kruger and other oil sands CEOs signed a nonbinding agreement with Alberta and Canada in July to set out the conditions for the development of the 'Pathways' carbon capture and storage project. This would reduce greenhouse gas emissions from oil sands. Mark Carney, the Canadian Prime Minister, has endorsed Alberta’s vision for a new pipeline that would export 1 million barrels per day to the Pacific Coast. However his support depends on whether the Pathways project is implemented. Carney's government has been working to mend relations with the Canadian oil industry for a number of years. The industry had fought many of Justin Trudeau's environmental policies. Carney has reversed or diluted many of these policies and promised to accelerate the permitting process for major energy projects. Many of the?proposed policy changes are not yet drafted into legislation. Enbridge, the Canadian pipeline operator, announced last week that it would 'postpone' a planned expansion of Mainline by 250,000 bpd due to oil producers unwillingness to commit significant production increases. Kruger stated that while the tone of the 'Canadian Government is more positive than in the past decade, the company wants to take its time before making any commitments to accelerate their growth plans. Suncor announced in March that it expected to increase its upstream production from 840,000 to 870,000 barrels per day (bpd) by 2028. Kruger stated that Suncor has the option of ramping up more quickly if so desired. He said, "We haven't changed to this mode at all. But we do have flexibility." (Reporting from Amanda Stephenson, Calgary; editing by Nia William)
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Iran Ministry: Iran and Oman have reached an agreement on the coordinates of the route through Hormuz
Esmaeil baghaei, spokesperson for the Iranian Foreign Ministry, said that Iran and Oman had'reached an agreement on the geographic coordinates of a shipping route across the Strait of Hormuz. A joint announcement is being finalised if certain third parties do not interfere. Baghaei said that such an agreement between Iran and Oman, would not guarantee the security of this strategic waterway. A senior Iranian official and two regional officials told reporters on Wednesday that the proposed deal between Oman and Iran would give Tehran control of ships entering the 'Gulf via the Strait of Hormuz. This is one of the biggest concessions made to Iran yet. Sources rebutted claims by U.S. president Donald Trump, that a deal to reopen the Strait of Hormuz was imminent. They said important details had to be agreed. Esmaeil baghaei, spokesperson for the Iranian Foreign Ministry, described the negotiations between Tehran and Muscat as being "professional" in nature and "moving ahead", saying that "the two sides had reached a mutual understanding on the geographic parameters of the route discussed". Baghaei said that, "if third parties don't obstruct this process, then the joint statement between these two countries, which contains the?"main considerations" and "key points of understanding", is in the final stages. Reporting by Elwely Elwelly, Menna ala El Din and Alison Williams. Editing by Ros and Alison Williams.
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Increased Black Sea attacks put pressure on global commodity flow
The Black Sea region is the latest strategic trade chokepoint that has been hit by an escalating conflict. The Black Sea is an important route for grain, crude oil and refined products. The waters of the Black Sea are shared between Russia, Ukraine, Bulgaria, Georgia and Romania. In recent weeks, both Russia and Ukraine have intensified their attacks on the other's agricultural export vessels and facilities in the Black Sea region. Kyiv also increased its attacks on Russian oil tankers. The latest escalation creates another pressure point on commodity markets, already dealing with disruptions in major shipping routes across the Middle East. Kayoko Gotoh, a U.N. representative, told the Security Council last week that "the consequences... are already evident in global agricultural markets." "We cannot allow this dangerous spiral to continue." The U.S./Iran conflict has disrupted oil flows through the Strait of Hormuz, and a maritime ban imposed by Houthis in Yemen who are aligned with Iran on Saudi Arabian ports & ships has increased risks for Red Sea shipping. GRAIN EXPORTS STRAINED According to the Infrastructure Ministry, Ukraine reported 35 attacks in July on vessels in port, 22 at sea, and 67 strikes?on port infrastructure. Ukraine is estimated to have targeted dozens tankers that are involved in the Russian oil trade. Already, the escalation has affected trade flows. FESCO, a Russian shipping company, said 'this week that it has suspended new orders for shipments via the Black Sea following a drone attack on one of its ships. Russia has intensified its strikes on civilian vessels and the port infrastructure in southern Odesa, Ukraine. Through this hub, more than 90% Ukraine's agricultural products are exported. Both Russia and Ukraine claim that they only target military targets. More than four years after the end of the war, agricultural products are still Ukraine's main source of export revenues. Kyiv seeks alternative export routes. However, Agriculture Minister Taras Voysotskyi said this week that they will not reach their full capacity until August. They would also only handle about half of the volume normally shipped via Black Sea ports. Trade sources reported that since July 10, shipping activity in the Sea of Azov which leads to the Black Sea has been restricted. This has affected activity at Taman, the main Russian grain port. The export of grain from Novorossiysk and Tuapse continues, but at a lower rate than before. Oil exports have also been affected. In July, Ukrainian tanker attacks damaged several vessels. This forced the temporary suspension of loading operations in Novorossiysk as well as the Caspian Pipeline Consortium terminal (CPC), the main outlet for Kazakh crude. In a report published this week, shipbroker BRS stated that the CPC system was a vital?export route in Kazakhstan. It handles roughly 80% percent of the country's oil exports. Any disruption could have a negative impact on regional supply. Ambrey, a British maritime security company, advised clients that vessels continuing to call at Black Sea port should carry out comprehensive voyage threat assessment and that crews should remain within designated safe muster areas during drone attacks. Stephen Cotton, General Secretary of the International Transport Workers' Federation, a leading union of seafarers, said: "The killings of innocent civilian seafarers are?unacceptable. They cannot be considered 'collateral damages' in order to achieve military goals - this is an immoral precedent and a very dangerous one." BLACK SEA WAR INSURANCE JAMMERS Shipping costs are also increasing due to rising security risks. According to market estimates, the average daily Black Sea oil tanks costs have increased from $200,000 to more than $300,000. According to insurance sources, war insurance costs for port visits to terminals in the Black Sea have increased to 2% of ship value, up from 1% just two weeks ago. Insurance sources say that even small increases can add up to hundreds of thousands in extra costs for each voyage. Niels Rasmussen is the chief shipping analyst at shipping association BIMCO. He said that if the Black Sea volumes continued to be reduced as they have been over the last two weeks, the global dirty (crude) oil tanker volume could fall by 3%. (Reporting and editing by Ros Russell; Additional reporting by George Abbott of The Insurer & Bureaus, with additional reporting from Jonathan Saul)
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Gulf oil exports stable in July but still 40% below prewar level
Shipping data showed that the Gulf countries' crude and condensate oil exports remained largely stable in July, and were about 40% lower than pre-war levels. However, signs of a decline emerged in the second half as fighting intensified in the region. The relatively stable levels of exports have eased concerns over a more severe disruption in supply and offset the drawdown in global inventories. Tanker traffic in the Strait of Hormuz, and Bab el-Mandeb, two of the most important Middle Eastern waterways, remained below the levels seen before the U.S./Israeli war against Iran started on February 28. Kpler reports that crude and condensate oil exports from Saudi Arabia, the United Arab Emirates (UAE), Iraq, Kuwait, and Iran increased by just 2% in July compared to June, averaging 10.7 million barrels a day. Kpler data and Vortexa showed that exports peaked between 12 and 13 millions bpd during the first half of this month, before dipping as the fighting between the United States and?Iran resumed. Iraq's exports doubled from June. Kuwait and Iran contributed to the increase, but Saudi Arabian and UAE shipments declined. George Morris, Vortexa analyst, said that nine additional very large crude carriers loaded in July boosted Iraqi Exports. However, flows through Hormuz are slowing as the fighting intensifies. In July, the International Maritime Organization received reports from at least 14 vessels in the region. This is up from 8 in June. Exports are up, allowing some producers to increase production. Kuwait increased crude production in July to 1.971 mbpd from 1.65 mbpd, according to a source familiar with the situation. Saudi Aramco CEO Amin Nasser said on Tuesday that the world has lost over 2.6 billion barrels since the war began. Rebuilding inventories would take 18 months, at a rate 2.1 million bpd. RED SEA EXPORTS SLOPING Last month, Yemen's Iran-backed Houthis stepped up their attacks near the Bab el-Mandeb strait. This caused Saudi crude exports - from the Red Sea port at Yanbu - to slow down. According to Energy Aspects, the Yanbu loadings dropped to 3 million BPD after July 20, from 3.8 millions BPD in April-June. Richard Bronze, co-founder of Energy Aspects, said that many tankers load?at Yanbu without their Automatic Identification Systems transponders on. Others are rerouting through the Suez Canal, and using the SUMED pipe connecting the Red Sea to the Mediterranean in order to avoid the Bab el-Mandeb. Reporting by Enes Tunagur and Ahmad Ghaddar, London. Editing by Tomasz Janovski)
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Increased Black Sea attacks put pressure on global commodity flow
The Black Sea region is becoming the latest strategic 'trade chokepoint' to be affected by an escalating conflict. The Black Sea is an important route for the shipment of?grains,?crude oils and refined products. The waters of the Black Sea are shared between Russia, Ukraine, Bulgaria, Georgia and Romania. In recent weeks, both Russia and Ukraine have intensified their attacks on the other's agricultural export vessels and facilities in the Black Sea region. Kyiv also increased its attacks on Russian oil tankers. The latest escalation creates another pressure point on commodity markets, already dealing with disruptions in major shipping routes across the Middle East. Kayoko Gotoh, a U.N. representative, told the Security Council last week that "the?consequences... are already evident in global agricultural markets." "We cannot allow this dangerous spiral to continue." The U.S.-Iran war has disrupted oil flows through the 'Strait Of Hormuz, and a maritime ban imposed by Houthis in Yemen who are aligned with Iran on Saudi Arabian ports as well as ships has increased risks for Red Sea shipping. GRAIN EXPORTS STRAINED According to the Infrastructure Ministry, Ukraine reported 35 attacks in July on vessels in port, 22 on sea, and 67 strikes against port facilities. In 2025, the vessels were only attacked 14 times. Ukraine is believed to have targeted dozens oil tankers that are involved in the Russian oil trade. Already, the escalation has affected trade flows. The Russian shipping group FESCO announced this 'week that it has suspended new orders for shipments via the Black Sea following a drone attack on one of its ships. In the meantime, Russia has intensified its strikes against civilian vessels and the port infrastructure in the southern Ukrainian hub of Odesa. Through this port, more than 90% Ukraine's agricultural products are exported. Both Russia and Ukraine claim that they only target military targets. Even after four years of war, Ukraine's top export source is agricultural products. Kyiv seeks alternative export routes. However, Agriculture Minister Vitaliy Kval said this week that they will not reach their full capacity until August. They would also only handle about half of the volume normally shipped through Black Sea ports. Trade sources reported that since July 10, shipping activity in the Sea of Azov which leads to the Black Sea has been restricted. This has affected activity at Taman, the main Russian grain port. The export of grain from Novorossiysk continues, but at a slower rate than before. Oil exports have also been affected. In July, Ukrainian tanker attacks damaged several vessels. This forced the temporary suspension of loading operations in Novorossiysk and the Caspian Pipeline Consortium terminal (CPC), the main outlet for Kazakh oil. In a recent report, shipbroker BRS stated that the CPC system was a vital export route for Kazakhstan. It handles roughly 80% percent of the country's oil exports. Any disruption could be a concern for regional supply flows. BLACK SEA WAR INSURANCE JAMMERS Shipping costs are also increasing due to the rise in security risks. According to estimates, the average daily Black Sea oil-tanker cost has risen to more than $300,000 per day, up from just under $200,000 per day a week earlier. According to insurance sources, war insurance costs for port visits to Black 'Sea terminals has risen from around 1% to 2% of the value of the vessel. Even small increases can add up to hundreds of thousands in extra costs per trip. Niels Rasmussen is the chief shipping analyst at shipping association BIMCO. He said that if the Black Sea volumes continued to be reduced as they have been over the last two weeks, the global dirty (crude) oil tanker volume could fall by 3%. (Reporting and editing by Ros Russell; Additional reporting by George Abbott of The Insurer & Bureaus, with additional reporting from Jonathan Saul)
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Tewolde Gebremariam is appointed as the new CEO of Air India
Air India appointed former Ethiopian Airlines Chief Tewolde Gebremariam to its 'CEO' post on Wednesday. The Indian airline is currently struggling with persistent losses, and increased regulatory scrutiny after a fatal crash last year. Gebremariam succeeds New Zealander Campbell Wilson. Wilson was a former Singapore Airlines executive who was appointed in 2022 as the new leader of Air 'India after it had suffered years of decline under state ownership. Air India reported that Wilson had informed Chairman N Chandrasekaran of his intention to step down in this year 2024. The 'Tata Group owned airline is suffering heavy losses, not only because of a heightened regulatory scrutiny following the '2025 crash but also as a result of operational disruptions caused by a conflict in the Middle East. These have increased costs and compounded effects from Pakistan banning airspace.
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Sources say that gasoline and diesel exports to Russia from Belarus reached a new record in July.
According to industry sources, and calculations, Belarusian gasoline and diesel supplies to Russia reached a monthly record in July. Fuel shortages were caused by unplanned outages at Russian oil refineries after months of relentless 'Ukrainian drone attacks. According to industry data and calculations, the Russian gasoline production had dropped early in July, to around 65% the average seasonal consumption. Diesel production had also fallen to the same level as domestic demand. The?Russian Government, in response to rising fuel prices at retail and wholesale, banned diesel exports. However, it allowed exemptions under previous contracts and intergovernmental agreements. Export restrictions for gasoline and jet fuel had already been implemented. Source data shows that gasoline shipments by rail from Belarus to Russia increased 13% from June to 212,000 tons. Diesel deliveries also doubled, reaching 162,000 tons. The total amount of jet fuel delivered from Belarus to Russia in July was 13,100 tonnes, compared with 16,100 tons in June. Belarus provides fuel to Russia from its two refineries that process Russian oil. They have a combined capacity of 24,000,000 tons per year or 480,000 barrels a day. In the first seven months of this year, the total amount of gasoline shipped by rail from Belarus into Russia increased 25-fold compared to the same period in 2025. Diesel deliveries also increased almost sevenfold, to 418 tons. According to industry sources, Russia has also begun importing gasolines from India, Kazakhstan, and Morocco.
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CPC oil loadings fail due to safety concerns and tanker shortages
The Caspian Pipeline Consortium suspended operations several times this week due to safety concerns and a shortage of tankers. This is because the main export route for Kazakh crude has been hit by drone attacks. Since the middle of the last month, the loadings of the pipeline have been disrupted. The pipeline carries around 1.8% of the global oil supply, from Kazakhstan to Russia’s Black Sea Coast. This adds to the supply disruptions linked to the U.S. and Israeli war against Iran. Sources said that the pipeline was only temporarily reopened this week and closed on Wednesday. Shipowners are reluctant to embark on CPC voyages due to the possibility of drone attacks. On Tuesday, the Russian group FESCO halted operations in the area. A CPC Blend seller said it took multiple attempts to find a ship to load a cargo during recent weeks. The Russian Foreign Ministry accused Ukraine on Monday of attacking oil tankers at the terminal for the Caspian Pipeline consortium in Novorossiysk and claimed that Kyiv is trying to destabilise oil markets worldwide. Kyiv did not claim responsibility for the incident or make any comments on why they may have expanded their campaign against Russia by targeting a pipeline which carries crude oil mainly produced by U.S. majors and European oil companies. No one of the eight people we spoke to was able to be identified because they were not authorized to speak in public. The Energy Ministry of Kazakhstan said that it was not considering a total shutdown of CPC operations and that everything was under control. On Wednesday, the ministry still had not responded to a?request for comment. CPC declined to comment. Kazakhstan is a landlocked country that relies heavily on Russian ports for exporting crude oil by sea. This means that disruptions to the pipelines and loading can cause?production reductions. When attacks on tankers increased in July, Kazakhstan's oil production?fell 14% compared to June. Sources said that Tengizchevroil intends to export 100,000 metric tonnes of oil by rail in August to Georgia's Black Sea Port of?Batumi. CPC Blend?differentials are weaker due to disruptions. CPC blend cargoes for August loading were sold at a price nearly $4 per barrel lower than dated Brent last week. This is compared to the premium that was paid a few short weeks ago. Reporting by Robert Harvey, LONDON; and MOSCOW reporters; Editing by Barbara Lewis
Oil companies compete for projects that will boost Venezuelan production quickly. A real grind is in store
A rig that drills wells in shallow water completed its long journey from China to Venezuela’s oil-producing Lake Maracaibo region. Residents and workers were excited to see the passage of a big old rig called Alula, which passed just inches below a bridge that connects Maracaibo with the oilfields on the eastern shore of Lake Maracaibo. This was due to U.S. sanctioned.
The rig struck an oil pipeline while it was passing through the lake, and also over the metallic spaghetti that was 20,000 kilometers worth of pipes below the water. The oil leaked out for several months before repairs were made. It was only last year that the rig was installed in the polluted water. Since then, the crude production has increased only modestly.
The Alula's story is a cautionary one for foreign energy companies, such as U.S. major oil company Chevron, that want to expand quickly in Venezuela and undertake short-term projects to boost the country's output of oil. Every step forward brings with it a whole new set of challenges.
Maurel&Prom, ENI of Italy, Spain's Repsol and China National Petroleum Corp. are also foreign companies that have a foothold in the country.
Donald Trump has asked American companies to invest $100 billion in rebuilding the oil industry, which was neglected for 20 years by socialist presidents Hugo Chavez & Nicolas Maduro. Washington has eased sanctions since its early January military invasion to snatch Maduro by issuing a few general licenses to energy companies that allow them to invest, export, and import oil and gas in the OPEC-member.
Two executives of companies with assets in the country said that early expansion could result in a crude oil output increase by as much as half a million barrels per day (bpd). The current production is 1,000,000 bpd.
The U.S. Secretary for Energy Chris Wright stated this month that he expected to receive a positive response from Venezuela.
"dramatic increase"
Venezuelan production is expected to increase in the next few months.
Houston, the U.S. capital for oil, and Venezuela's oil regions are a buzz, mobilizing to take part in the largest repair job ever undertaken by the energy sector. This is a massive undertaking comparable to the work undertaken to increase Iraq's oil production following the second Gulf War, or to restore the Kuwaiti oilfields that Saddam Hussein had set ablaze. According to a half dozen industry workers and oil employees who have experience in Venezuela, as well as executives planning to move there, along with numerous industry experts, analysts and other industry professionals interviewed for this article, the first phase of the project in Venezuela will involve relatively simple projects that can increase oil production quickly. These include refurbishing dilapidated oil wells, upgrading crude oil upgraders which are not working at full capacity, and repairing the ports and pipelines owned by the state oil company PDVSA. Even the "easy" projects, according to the experts, are difficult, and the rest of the work will be even more challenging. A reporter touring the Lake Maracaibo region in early February saw oil industry junk. Tanks overflowing with oil, abandoned oilfields. Blackened shorelines. And long lines of cars waiting to buy gasoline near storage terminals. The squalor and soiled shorelines, abandoned oilfields, tanks overflowing with crude, and long lines of vehicles waiting to buy gasoline near storage terminals or PDVSA operational sites were visible reminders that much work remains, even for what could be considered the "low-hanging fruits" in a region which is home to Venezuela’s oldest production facilities, as well as having the second largest output capacity.
The first step that companies anticipate is to implement projects such as the one planned by China Concord Resources Corp., which brought the Alula drilling rig to Venezuela in 2017. The company wants to increase the combined light and heavy oil output from two fields from 16,000 bpd to 60,000 bpd this year through a $1billion program. This would require refurbishing up to 875 inactive rigs before drilling new wells. A source with the project stated that the company is currently addressing many unplanned problems, including insufficient gas supply to maintain pressure on wells and the loss of technical data.
After Trump stated that companies from U.S. political rivals - China and Russia - are no longer welcomed in Venezuela, it is not clear if the project will go ahead. Companies from these countries were the only ones willing to work in Venezuela under sanctions.
Chevron, on the other hand, has been the sole U.S. oil major to produce crude in the United States for many years and is now in a prime position?to make early gains. The company is in a race with its rivals for supplies of the light crude produced by China Concord.
Energy companies in Venezuela are able to make a profit by importing fuels and light oil that can be used to dilute Venezuelan tar-like crude oil. The country's vast reserves of extra-heavy crude oil cannot be exported or transported without expensive upgraders and diluents. Foreign oil companies are more interested in producing barrels that are relatively simple to produce than those produced by PDVSA, who has ignored these regions for decades to focus on the Orinoco Belt and its heavy-oil wealth. Former employee of the Venezuela operations said that oil from Maracaibo would be more cost-effective for Chevron, as it doesn't need to be treated prior to export. This is especially true when crude prices are low. The former employee stated that other options included reopening wells closed due to lack of power or specialized equipment, reconditioning wells with low output to increase production, and drilling new ones.
Chevron stated that it has "been a part in Venezuela's history and remains committed to work in partnership for the future of Venezuela." It also added that it welcomed recent U.S. licensing and legal reforms.
PDVSA and the oil ministry of Venezuela did not respond to requests for comments. China Concord was not immediately available for comment.
HEAVIER ORINOCO CRUDDE Oil companies with stakes in projects and oil contracts across the country are vying for access to specialized machinery already present. There are up to 14 drilling rigs that have been in storage for years in Venezuela and are owned by Houston-headquartered SLB, one of the top global oil service providers, three sources with knowledge of its assets said. SLB is the main service provider for Chevron, since 2024 when it started its latest drilling program in Venezuela as part of an earlier U.S. wide license. SLB, like the U.S. giant, has a long history in Venezuela. SLB's rigs in Venezuela were used for PDVSA-related projects before the U.S. sanctions of 2019. U.S. companies, and those who adhered to U.S. sanctioned, could no longer operate rigs in Venezuela.
SLB says it has operational facilities, staff and equipment in Venezuela and is "in the early stages of collaboration" on next steps with customers. We are confident we can quickly ramp up operations under the right conditions.
The vast Orinoco Belt is in dire need of drilling and workover rigs, as the output usually involves clusters of wells. Diluents for blending with extra-heavy crude may be needed more urgently to reduce oil inventories that have accumulated over the past few months and to boost exports. Chevron, along with other PDVSA partners, is focused on securing the drilling equipment and access to crude upgradingrs as well as light oil and naphtha for blending. The U.S. firm would also have to renovate PDVSA-owned infrastructure, such as the Bajo Grande Export Terminal. It would also have to dredge a shipping channel on Lake Maracaibo, which hasn't been done for years due to sanctions that prevented companies from hiring dredges. Chevron would need to overhaul its Petropiar Project's upgrader in order to increase production at Orinoco. This converts the extra-heavy crude into exportable grades. Two Chevron sources also said that the facility hasn't been fully repaired in years.
Five projects, out of more than 40 joint ventures between PDVSA, foreign and local companies and other oil companies in Venezuela, have upgraded or blended the Orinoco extra heavy crude. This region holds over 80% of Venezuela's estimated 303 billion barrels worth of crude reserves. Without upgraders, companies would be forced to import expensive diluents in order to export barrels. This would lower their profits and also present logistical problems due to Venezuelan limitations on discharging and transporting them.
North American Blue Energy Partners has been working on repairing a PDVSA rig for the Orinoco Petrocedeno Project for several months. The company has close ties with American asphalt magnate Harry Sargeant. Two sources said that completing the repairs would allow the equipment to be brought online quickly.
North American Blue Energy Partners didn't immediately respond to a comment request.
Thomas O'Donnell is an independent energy analyst who says that many Venezuelan oilfields which are written off as being depleted still have significant production capacity.
"Many of the plants that were said to have died or been depleted are not actually depleted." He said that PDVSA lacked the skills or equipment to continue running these fields and cherry-picked them.
O'Donnell pointed out mature fields, where seismic surveys using 2D technology were last conducted in the early 1990s and the late 2000s. He said that companies could make substantial gains if they brought up-to-standard fields which were already in operation. This could result in "maybe a 50 or 100 percent increase over what is coming out currently."
LEGAL RISK REMAIN
A Venezuelan oil company executive, who spoke on the condition of anonymity and has worked there, stated that the country's overall production could reach 1.5 million bpd in less than a calendar year, if oil producers obtain the necessary licenses.
Venezuelan oilfields, he said, are "very forgiving. You can increase production a great deal," referring the abundant reserves. The executive did add that there are still supply chain problems and security issues, especially around Maracaibo.
Executives also pointed out that there was still legal uncertainty, since it is not possible to guarantee that agreements made now will be honored by future governments. Venezuela's National Assembly approved in January a comprehensive oil reform that gave autonomy to foreign companies. However, some new contract models, which had been initially promoted by Maduro without much success, are still seen as risky by potential investors. The legitimacy of the passed reform is also questioned from a constitutional perspective. The U.S. and other countries have refused to recognize the results of the rigged parliamentary and president elections in the past.
Investors should also be aware of the possibility that future U.S. government may ease pressure on Caracas and allow it to regain control over oil exports and revenues.
According to a worker who has worked in the area for 22 years, the amount of investment needed will be huge. The worker stated that many companies have the ability to fix the problem, but the willingness to do so will depend on how they react once they see the disaster.
(source: Reuters)