Russian oil companies want consortium in Latin America

September 18th, 2008 - 5:48 pm ICT by IANS  

Caracas, Sep 18 (RIA Novosti) Russia’s five major oil companies have said they are interested in setting up a consortium to boost operations in Latin American countries. The oil firms which have come up with the idea are Rosneft, LUKoil, Gazprom Neft, Surgutneftegaz and TNK-BP.

Deputy Prime Minister Igor Sechin, who chairs the board of state-controlled Rosneft, Russia’s largest oil company, said: “It would be strange for Russia, which shares first place in global oil production with the Saudis, not to interact, say, with Venezuela, which holds fifth or sixth place.”

“The idea of creating a consortium comprising almost all the large Russian oil companies came from the companies themselves, which would like to work in Venezuela, and not only here,” Deputy Prime Minister Igor Sechin, who chairs the board of state-controlled Rosneft, Russia’s largest oil company, said Wednesday.

Sechin was addressing a press conference here summing up his working visit to Cuba and Venezuela.

“It would be strange for Russia, which shares first place in global oil production with the Saudis, not to interact, say, with Venezuela, which holds fifth or sixth place,” he said.

Sechin said Russia is increasing its cooperation with Latin American countries in several areas.

He said a consortium would make it easier to build upgrading facilities to improve the non-conventional or heavy oil of Venezuelan. The construction of an upgrader would cost up to $6.5 billion, which would be hard for one company to finance, but a consortium could share the expenditure, he said.

Venezuela has around 87 billion barrels of proven conventional oil reserves. In addition, it has vast non-conventional oil deposits. Most of these deposits are located in the Orinoco oil belt.

Venezuela’s state-run oil company PDVSA signed a deal with Russian energy giant Gazprom this year to evaluate and certify the Ayacucho-3 oil fields in the Orinoco belt. LUKoil signed a memorandum of understanding and an agreement with the company on joint exploration in the Junin-3 area, also in the Orinoco belt.

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