Venezuela oil vessel stable, transfer afoot: Update

Market: Crude oil
02/09/20

Adds new Eni statement, Trinidad minister remarks.

A floating oil storage and offloading vessel (FSO) that was listing off Venezuela's coast has been stabilized and a transfer is planned, according to Italy's Eni, a minority partner of Venezuelan state-owned PdV at the field where the Nabarima has been moored for 10 years.

"The conditions of the FSO are stable and a recent water leak has already been solved," Eni said today.

Eni holds a 26pc stake in the PetroSucre joint venture controlled by PdV. The Corocoro field had been producing around 11,000 b/d of medium-quality crude before it was suspended in August 2019.

In a follow-up statement this afternoon, Eni said "as reported by [the] operator there is currently no risk of oil spill" and the company "is collaborating with PetroSucre to define and implement a program for unloading the oil cargo from Nabarima." The implementation of the program using a dynamic positioning tanker and technical services is not prevented by US sanctions, the company said.

The firm added that it "performs its activities in Venezuela in compliance with international agreements and laws; Eni's crude liftings are part of credit recovery programs that fall within exceptions granted under the sanctions regime."

Venezuelan contractors and workers on and off the Nabarima have described broken equipment and a lack of maintenance that they say contributed to flooding of the vessel's engine room in recent days. The fresh water came from internal equipment and has since receded.

PdV and oil ministry officials told Argus this week that the around 1.15mn bl of stored crude would be transferred to another vessel in order to stabilize the FSO, but it did not disclose concrete plans.

The crude has been stored on the small double-hull very large crude carrier (VLCC) for more than a year, mainly as a result of PdV's difficulties in finding buyers in the face of US sanctions. But an FSO is not designed to hold oil for a prolonged period of time, but rather to be filled and emptied on a regular basis, taking in production and offloading the crude onto tankers.

Eni denied that it hired technicians to assess the vessel, as reported earlier to Argus by a PetroSucre official.

The workers say they remain concerned about conditions on the Nabarima.

The unit is moored in the Paria Gulf, close to Trinidad and Tobago where equipment suppliers have been approached to assist in addressing the issue.

Trinidad on stand-by

Trinidad is ready to activate a bilateral oil spill contingency plan with Venezuela, but the transfer of oil from the FSO is affected by the US sanctions, the Caribbean country's energy minister Franklin Khan said.

"The contingency plan will govern our response to any eventuality," Khan said. "Parties are free to request assistance from each other."

The vessel is now at full capacity and the Venezuelan authorities say the ship is upright and in a stable condition "pending preparation for the transfer of the cargo to a contracted vessel," Khan said.

"The oil is then transferred to tankers for shipment abroad, but because of the sanctions the transfer vessels stopped operating."

By Patricia Garip and Canute James

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Pemex's lean Zama spending undercuts goals

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Cost of government support for fossil fuels still high

21/11/24

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21/11/24

Cost of government support for fossil fuels still high

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Cop: Talks in Baku torn between mitigation and finance

21/11/24

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21/11/24

Cop: Talks in Baku torn between mitigation and finance

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Cop: EU, four countries commit to 1.5°C climate plans

21/11/24

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21/11/24

Cop: EU, four countries commit to 1.5°C climate plans

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Cop: EU says finance draft text not acceptable

21/11/24

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21/11/24

Cop: EU says finance draft text not acceptable

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