(EnergyAsia, May 28, Wednesday) — Venezuela’s state oil major Petroleos de Venezuela SA (PDVSA) and China National Petroleum Corp (CNPC) have agreed to build a refinery in China and to jointly develop oil production in Venezuela’s Orinoco region.
CNPC said it will have a 40% stake while PDVSA has a 60% share in the venture to produce and upgrade the super-heavy oil at the Junin-4 block in the Orinoco heavy oil belt. The partners plan to produce 20 million tons of oil a year.
CNPC said it will own a 60% stake in the proposed refinery with PDVSA as the minority 40% partner. The refinery would likely be located in southern China, with a design capacity of 400,000 b/d using mostly Venezuela’s heavy crude oil.
The two deals follow closer ties between the two countries. Faced with rising oil consumption, China’s oil firms are entering into long-term supply agreements with producers in many parts of the world, including Iran and Sudan.
Separately, CNPC’s listed subsidiary PetroChina is said to be in talks with investors from Qatar to build a refinery in China’s eastern Zhejiang province.