Venezuela's Orinoco syncrude projects back online

www.forbes.com Reuters, 02.28.03, 12:29 PM ET

CARACAS, Venezuela, Feb 28 (Reuters) - Venezuela's four foreign-financed extra heavy oil upgrading projects from the Orinoco region are back online following the restart of the Petrozuata joint venture on Friday. The projects, which partner state oil firm Petroleos de Venezuela PDVSA with international firms such as U.S. ExxonMobil (nyse: XOM - news - people) and French TotalFinaElf <TOTF.PA>, had been pumping over 400,000 barrels of extra heavy oil before shutting down due to an oil strike started Dec. 2. The Cerro Negro and Sincor projects resumed output this week after PDVSA restarted natural gas supplies needed as feedstock for processing units that upgrade the ultra heavy oil into synthetic crude for export. Ratings agency Standard & Poor's said on Friday Petrozuata's field production "is ramping up as upgrader charge rates rise." Petrozuata officials were not immediately available to give further details. A fourth project, Hamaca, has resumed limited output of the tar-like Orinoco oil mixed with lighter crude to create an exportable blend. Hamaca's synthetic crude upgrader has not been completed. Initial output from all four projects will increase as gas supplies improve. Venezuela's government has been battling to restore the strike-hit oil sector, which provides half of state revenue. President Hugo Chavez fired over 15,000 PDVSA workers who took part in the strike, hiring replacement workers and the military to staff abandoned posts. The OPEC nation, normally the world's No. 5 crude exporter, was pumping nearly 3.1 million bpd of oil including output from the Orinoco region before the strike. On Thursday, oil minister Rafael Ramirez said total oil production had been restored to 2.08 million bpd. But PDVSA employees and rebel oil workers said that output temporarily fell by 450,000 bpd to 500,000 bpd on Friday. The rebel workers say output is now 1.13 million bpd.