Venezuela 2023 oil output to remain flat: Tellechea

: Crude oil, Natural gas
23/07/24

Venezuelan oil production will likely remain near the current 830,000 b/d level for the rest of 2023 and not reach the previously touted 1mn b/d mark, energy minister and state-owned PdV president Pedro Tellechea said last week.

In a recording of a presentation given to the Federation of Venezuelan Industrialists guild on Friday, Tellechea said oil production is averaging 831,000 b/d this year and is expected to reach 860,000 b/d in July, an admission an earlier 1mn b/d goal cannot be reached.

"Surely we are behind, but I don't have a magic wand, by year end we will achieve one million oil barrels per day," he said. Production "has to be sustainable. You can't reach one million barrels a day and then have that number drop down. That's abnormal."

Most outside sources report lower monthly production figures for the country. Argus estimated Venezuelan production in June at about 760,000 b/d.

Tellechea said PdV plans to more than double existing production in 2024 to 1,760,000 b/d through the reactivation of mothballed oil wells.

In his presentation, Tellechea described a Venezuelan energy industry in deep disarray after years of US sanctions and the corruption of the PdV-Crypto scandal. When he took over PdV in January "... there was a supplier overcharging us 400pc for oil well chemicals," Tellechea said. "That boy now is in a different situation. We can't allow that, because that is the heritage of all Venezuelans. We have regrettably arrested a lot of our own officials too. We can't keep on allowing that."

Sanctions are also impeding certain operations, Tellechea said. Gas compressor plants in Zulia state require reengineering, for example, but since they use US technology, reaching agreements with the equipment license holders "have proven impossible."

Tellechea said that when he took over as chief executive of state-owned petrochemical business Pequiven four years ago — a title he still holds — plants such as the Hugo Chavez petchem complex had been "completely stripped" of equipment.

PdV plans sign its first licenses to export natural gas by the end of the year, despite limited natural gas production and no export or import infrastructure. The country will soon also end subsidies for natural gas in the domestic market, he said.

"We need to become natural gas exporters," Tellechea said. Export licenses for condensates and natural gas liquids were issued in May.

By Carlos Camacho

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

24/11/19

LNG diversions to Europe reach double digits

London, 19 November (Argus) — At least 11 LNG carriers have likely diverted to Europe from Asia and Egypt over the past week, as European delivered prices now offer higher returns than Asian delivered prices, and operational issues delay deliveries in Egypt. Of the 11 cargoes, seven have diverted away from sailing for Asia round the Cape of Good Hope towards Europe, and four have diverted from Egypt, judging by shiptracking data from Vortexa (see table) . This does not include the 173,400m Myrina , which was idling in the mid-Atlantic today. One carrier — 174,000m³ Aristos I — had already passed the Cape of Good Hope, before turning back towards the Atlantic basin. Assuming all carriers are holding full cargoes, this totals around 860,000t, or 13.2TWh of LNG. Northwest European delivered prices rose above corresponding northeast Asian prices last week , prompting diversions from Asia to Europe. The inter-basin arbitrage was already closed, although firms with surplus shipping capacity that they viewed as a sunk cost because of long open vessel lists were still willing to send Atlantic basin cargoes to Asia as the opportunity cost of the longer journey time was limited to the cargo loss through higher boil-off during the voyage. But Europe's discount to Asia has narrowed, and even inverted late last week, with the spread between the two markets less than the boil-off cost difference between US deliveries to Europe and to Asia, incentivising diversions to Europe. The extra boil-off losses amount to around 39¢/mn Btu when shipping a cargo from Sabine Pass to Incheon via the Cape of Good Hope instead of Rotterdam, assuming a northeast Asian delivered price of $14.05/mn Btu, a sailing speed of 17 knots and a 160,000m³ cargo with a 0.1pc daily boil-off rate. The Argus Northeast Asia (ANEA) January delivered price closed at a 49¢/mn Btu premium to the northwest European December des price on 7 November, enough to incentivise deliveries to northeast Asia instead of Europe for firms with sunk shipping capacity as the spread was wider than boil-off losses. But the ANEA January price on 14 November fell to a discount to prompt northwest European des prices, incentivising diversions to Europe. And four carriers have diverted away from Egypt, where delays to a tight delivery schedule have been created by operational issues at the country's 6mn t/yr Ain Sukhna terminal, according to market participants. One of the terminal's two regasification trains has been experiencing operational difficulties, halving the terminal's regasification capacity, they said. The country last imported a cargo on 16 November — nine days after the previous delivery. The terminal's Hoegh Galleon floating storage and regasification unit has a peak regasification rate of 750mn ft³/d (7.7bn m³/yr), equivalent to about 16,500 t/d, meaning that it could regasify a 72,000t standard-sized cargo in 4-5 days when operating at full capacity. By Martin Senior Diversions to Europe m³ Carrier Capacity Diversion date Approx diversion location Diversions from Asia BW Lesmes 174,000 13-Nov West Africa Gaslog Windsor 180,000 14-Nov West Africa Vivirt City LNG 174,000 15-Nov West Africa LNGShips Empress 174,000 18-Nov Carribean Diamond Gas Crystal 174,000 14-Nov Carribean Flex Vigilant 174,000 14-Nov Carribean Aristos I 174,000 18-Nov Madagascar Diversions from Egypt British Listener 173,000 13-Nov Mediterranean LNG Harmony 174,000 14-Nov Mid-Atlantic Axios II 174,000 14-Nov Mid-Atlantic Pacific Success 174,000 16-Nov South of Suez — Vortexa, Argus Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: Countries join fossil fuel subsidy phase-out group

24/11/19

Cop: Countries join fossil fuel subsidy phase-out group

Baku, 19 November (Argus) — Colombia, New Zealand and the UK today joined a Netherlands-led international coalition focused on phasing out incentives and subsidies for fossil fuels. They made the announcement at the UN Cop 29 climate summit in Baku, Azerbaijan. The coalition was first formed at Cop 28 in December last year. Member countries that sign up to the coalition commit to publish an inventory of their fossil fuel subsidies a year after joining, and to develop a plan to phase them out. Countries agreed at Cop 26, in 2021, to phase out inefficient fossil fuel subsidies, and reaffirmed this a year later at Cop 27. G20 members first pledged in 2009 to do the same. But global fossil fuel consumption subsidies hit over $1.2 trillion in 2022 and more than $600bn in 2023, IEA data show. "We truly feel that this is something we should tackle at a European level as well", EU energy commissioner Wopke Hoekstra said today. "This is something the next Commission will push; this is something I will personally push", he added. New Dutch climate and green growth minister Sophie Hermans admitted that phasing out fossil fuel subsidies is a "sensitive topic", but that the country is working on a plan. The first step is to make transparent which fossil fuels subsidies are in countries' systems, she said. The coalition now has 16 members — Austria, Antigua and Barbuda, Belgium, Canada, Costa Rica, Denmark, Finland, France, Ireland, Luxembourg, the Netherlands, Spain and Switzerland, as well as the three countries that joined today. Four members have made their national inventory of fossil fuel subsidies transparent — Belgium, France, Ireland and the Netherlands. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

G20 mayors call for $800bn/yr to address climate change

24/11/19

G20 mayors call for $800bn/yr to address climate change

Rio de Janeiro, 19 November (Argus) — Mayors from G20 countries are asking for at least $800bn/yr in investments by 2030 to tackle the effects of climate change. "We need better and faster access to international financing to ensure infrastructure that supports the socioeconomic security of our communities," Rio de Janeiro's mayor Eduardo Paes said. The joint statement from nearly 60 mayors and urban leaders was drafted during the Urban20, a G20 forum that includes leaders from major cities worldwide, and was delivered to Brazilian president Luiz Inacio Lula da Silva. The statement will also be delivered to other G20 members during the ongoing G20 summit in Rio de Janeiro. Climate change is one of the main topics being debated at the G20 summit. Brazil, which holds the G20 presidency this year, has set the energy transition as one of its goals for the year. The group reaffirmed its support for the Paris Agreement climate goals , saying it "fully subscribes" to the Cop 28 deal struck last year, which included language on transitioning away from fossil fuels. Urban investments such as low-emission transport, clean energy, and climate-resilient infrastructure can "significantly reduce emissions" and boost economic growth, according to the statement. The funding could unlock around $23.9 trillion in returns by 2050, it said. The $800bn/yr would cover around 20pc of urban climate finance needs and "serve as a catalyst for additional private sector funding," according to the Global Covenant of Mayors for Climate and Energy, a non-government organization for climate leadership that comprises over 13,000 cities worldwide. By Lucas Parolin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: Progress on actions to cut emissions uncertain

24/11/18

Cop: Progress on actions to cut emissions uncertain

Baku, 18 November (Argus) — Progress on mitigation — actions to cut greenhouse gas emissions — is uncertain at the UN Cop 29 climate summit, as talks on a specific text related to the issue are at risk to be pushed back to 2025, losing any progress made in the past year. Some countries had proposed using the mitigation work programme — a work stream focused on reducing emissions — to progress the commitment made at Cop 28 in 2023 to "transition away" from fossil fuels. But talks have stalled and could end without a conclusion at the summit. Developed countries as well as developing nations including some small island states and countries in Latin America — such as Brazil, Colombia, Peru, Mexico — have expressed disappointment about how mitigation talks were going. New Zealand called on countries to follow up on last year's decision on mitigation at Cop 28 and Norway added that these issues deserved "more than silence on mitigation". Switzerland complained that mitigation was "held up by a select few", and said that the discussion was critical for increased commitments for next year's 2035 Nationally Determined Contributions (NDCs). NDCs are countries' climate plans that include emissions reduction targets. Cop parties are due to submit new versions by February 2025. The US also said that Cop 29 needed to "reaffirm the historical Global Stocktake decision" taken last year. And developed nations, led by the EU, called for the discussion to continue this week — the second week of Cop 29. But countries including Bolivia, Iran and Saudi Arabia, for the Arab Group, pushed back on this. The mitigation work programme is "not… open to reinterpretation", Saudi Arabia's representative said today. The country said earlier that it did not want new targets to be imposed, complaining about the "top-down approach" taken by developed countries. India reminded developed countries that they have yet to deliver on their new finance commitment — a crucial step for more ambitious NDCs in developing nations. But "Cop 29 cannot and will not be silent on mitigation", the summit's president, Mukhtar Babayev said today. "On mitigation we have been clear that we must make progress, "he said, adding that he has asked ministers from Norway and South Africa to consult on what an outcome on mitigation could look like. EU climate commissioner Wopke Hoekstra today said that it is "imperative that we send a strong signal this week for the next round of NDCs", he said. Points related to mitigation — including transitioning away from fossil fuels and phasing out inefficient fossil fuels subsidies — are currently mentioned in the draft text for the new finance goal, known as the new collective quantified goal (NCQG). It is the key issue at Cop 29. Developed countries agreed to deliver $100bn/yr in climate finance to developing nations over 2020-25, and Cop parties must decide on the next stage — including the amount. Developed countries are likely push for the fossil fuel language to stay in the finance goal text, especially if mitigation talks stall elsewhere. But countries such as Saudi Arabia have long opposed this, while developed countries have received some criticism for still not having given an amount for the new finance target. By Georgia Gratton, Prethika Nair and Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: G20 momentum key to Cop climate finance outcome

24/11/18

Cop: G20 momentum key to Cop climate finance outcome

Baku, 18 November (Argus) — The outcome of the G20 leaders' summit in Brazil taking place on Monday and Tuesday on climate financing will be key to the success of the UN Cop 29 climate conference in Baku, Azerbaijan, summit president Mukhtar Babayev said today. "We cannot succeed without [the G20], and the world is waiting to hear from them," Babayev said. The leaders' summit takes place at the beginning of the second week of the Cop 29 conference. Progress at Cop 29 last week towards agreeing a new climate finance target for developing countries — the so-called NCQG — was not sufficient, Babayev said. He is concerned that parties are not moving towards each other fast enough. Little progress was made in the first week on three main areas of disagreement: the amount of climate finance which should be provided, how it should be structured, and which countries should contribute. Babayev urged G20 leaders, including US president Joe Biden who will be present in Brazil, to send a "positive signal of commitment to solving the climate crisis," and deliver clear mandates for Cop 29. The talks in Baku move from the technical to the political phase this week. Ministers typically have more authority to move red lines. But parties should focus on wrapping up less contentious issues early in the week so as to leave time for major political decisions, according to Simon Stiell, executive secretary of UN climate body the UNFCCC. Babayev expects talks on the amount of climate financing which will be on the table to continue until the last day of the summit at the end of this week, he said. The Cop presidency has invited former and upcoming Cop hosts the UK and Brazil to advise and "ensure an ambitious and balanced package of negotiated outcomes." Both countries have in the past week communicated more ambitious emissions reduction targets, which have been broadly welcomed. The EU today called for the Cop presidency to step up its role in the process. "We do need a presidency to lead, to steer us in the direction of a safe landing ground," European commissioner for climate action Wopke Hoekstra said. Hoekstra declined to be drawn on the amount of climate financing that the EU would like to see. Developing countries have pushed for a high goal of $1.3 trillion/yr, well above the previous target of $100bn/yr. The EU today reiterated instead its desire for the base of contributor countries to be enlarged beyond the current roster of countries defined as developed under the UNFCCC, and for as much private finance to be mobilised as possible to add to public finance. By Rhys Talbot Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more