BG decides against bidding for Venezuela gas block
www.forbes.com Reuters, 12.26.02, 3:42 PM ET
CARACAS, Venezuela, Dec 26 (Reuters) - British Gas <BG.L> will not bid on developing a natural gas block in the offshore Deltana region, a multi-million-dollar development it had been pre-selected to make an offer on, a company spokeswoman said. A spokeswoman for the company, which was chosen in August by the government to partner with U.S. oil major ChevronTexaco (nyse: CVX - news - people) in a bid for Deltana's Block 2, said the decision had nothing to do with the country's ongoing strike, now in its fourth week. "It was a strictly commercial decision," the spokeswoman said. Gas production from the region is slated to feed a planned 4.7 million tonne per year liquefied natural gas (LNG) plant that will export gas to the giant U.S. market by 2007. Venezuela's Ministry of Energy and Mines received bids for three blocks in the Deltana region near gas-rich Trinidad last week, in the midst of a strike by foes of President Hugo Chavez which has virtually halted the energy sector of the world's No. 5 crude exporter. ChevronTexaco offered $19 million to develop Block 2 without BG, while French major TotalFinaElf <TOTF.PA> offered $100,000 for Block 3. Norwegian firm Statoil <STAT.OL> offered $32 million For Block 4 while competitor TotalFinaElf offered $5.15 million. British major BP has separately been in talks for Deltana's Block 1. All firms would partner with state oil firm PDVSA. The government hopes to raise $4 billion through investment in Deltana. The opposition strike, which has the support of many PDVSA executives and managers, has severely reduced the OPEC nation's oil sales that provide about half of government revenues. Government efforts to break the strike using replacement workers have met with little success, and the dissident oil firm employees have said that they will not return to their jobs until Chavez is out of office. In Deltana, Venezuela is seeking to recreate the success of neighboring Trinidad, which has built one of the largest LNG export projects in the Atlantic basin. Copyright 2002, Reuters News Service