Petrobras, CVP create E&P joint venture

- Friday, July 21, 2006

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Brazil's federal energy company Petrobras (NYSE: PBR) and CVP, a unit of Venezuela's state oil company PDVSA, have created Petrowayu, the first of their four new E&P joint ventures, CVP said in a statement.

The four JVs with Petrobras are for the following fields in Venezuela: Acema, La Concepción, Mata and Oritupano-Leona.

Petrowayu will operate in La Concepción in western Venezuela's Zulia state. CVP will hold 60% of the JV, Petrobras 36% and Williams International Oil & Gas the remaining 4%.

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La Concepción output averages 12,300 barrels a day (b/d) of 35-37 degrees API. The JV could possibly increase that volume, CVP said.

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This is the sixth of 21 planned E&P JVs that CVP has formed with partners. Venezuela's national assembly has approved the deals in accordance with the 2004 hydrocarbons law, which states PDVSA must have at least 51% in every oil E&P project in Venezuela.

The new joint ventures substitute the old operating agreements between PDVSA and foreign oil companies, which the state company deemed too expensive.

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