Venezuela faces uphill task in oil output-striker
www.alertnet.org 28 Jan 2003 20:40
By Tom Ashby
CARACAS, Venezuela, Jan 28 (Reuters) - Venezuela faces an uphill task to free up strike-hit oil tankers, ports and trading to restore output to two-thirds of pre-strike levels within three months, a strike leader said on Tuesday.
Luis Vielma, former exploration and production director for state oil giant Petroleos de Venezuela (PDVSA), told Reuters current output of 1.05 million barrels per day (bpd) could double in 90 days only if the government succeeds in freeing bottlenecks in key areas of shipping and trade.
Restarting Venezuela's refineries, which process 1.3 million bpd, would take longer because of the lack of skilled staff, and Vielma saw this continuing to restrain crude flows.
"If they solve the problem of exports, they can easily pump two million barrels per day. If they fail to solve that problem, they won't," Vielma said in an interview. Vielma was among 3,000 managers fired for their part in the 58-day-old shutdown.
President Hugo Chavez said earlier this week Venezuela could reach 2.6 million bpd output within six weeks using replacement crews and troops to break the strike.
"What is limiting oil production is export capacity and refining," Vielma said.
The opposition says output had recovered to 1.05 million bpd on Tuesday, one third of pre-strike levels, while the government pegs crude flows at 1.3 million.
POLITICAL DEAL?
Vielma has previously said he does not expect the government to restore more than half of normal output levels without a political deal on early elections under which thousands of strikers would return to their jobs.
The strike in the fifth largest oil exporter has hit every aspect of the industry, from wellhead, to tankers, refining and ports. But it has been strongest among skilled workers, managers and traders, who are key to getting oil to market.
Vielma said current export levels of about 500,000 bpd were going to Cuba, a key Chavez ally, and Venezuelan-owned subsidiaries in the United States, Citgo and Lyondell Citgo.
"Oil is a very special commodity which has special contracts for special clients, which have been filled by Mexico and Arab producers," Vielma said.
"Getting that market back will not be easy, but if the export problem is solved they could get back to two million," Vielma said.
Even if strikers went back to work tomorrow, Vielma said it would take PDVSA six months to recover previous output levels fully.
Ignacio Layrisse, who as PDVSA technical director of exploration and production was Vielma's deputy, said he thought that Venezuela had lost 400,000 bpd of production capacity due to the accelerated decline in some wells and lack of drilling activity in almost two months of strike.