Chevron: No plans for new operations

Tuesday, July 31, 2007

US oil major Chevron (NYSE: CVX) has no plans for expanding operations in Venezuela, Chevron chairman David O'Reilly said in a conference call with investors and journalists.

Instead, the company is focusing on restructuring its operations in the Hamaca JV it shares with Venezuela state oil company PDVSA, a Chevron spokesperson told BNamericas.

"Chevron has signed an MOU for the conversion of the Hamaca heavy oil project to a joint Venezuelan company," the spokesperson said. "The terms and conditions of the contract will not be disclosed until final approval by the national assembly, which is expected by August 26."

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Chevron reported a second quarter net income of US$5.4bn, up from the US$4.4bn saw in 2Q06, according to a Chevron statement.

The company's global oil-equivalent production was 2.63Mb/d, down 1% from 2Q06, due mainly to the effect of converting the company's operating service agreements in Venezuela into JVs controlled by PDVSA, according to the statement.

PDVSA required at least 60% control of JVs operating in the Orinoco heavy crude belt.

Hamaca, renamed Ameriven, was renamed again this week Petro Piar.

PDVSA controls 70% of the venture after nationalizing the 40% share formerly held by oil major ConocoPhillips (NYSE: COP).

ConocoPhillips pulled out of Venezuela after failing to negotiate the conversion of their assets into PDVSA-controlled JVs.