Venezuela hands China more oil presence, but no mention of new funds

[To-Whose-Benefit?]

Reuters
Ben Blanchard, Alexandra Ulmer, Sept 14, 2018

[excerpt]

https://www.reuters.com/article/us-china-venezuela/venezuela-hands-china-more-oil-presence-but-no-mention-of-new-funds-idUSKCN1LU1EV

BEIJING/CARACAS (Reuters) - Venezuela gave China another stake in the OPEC nation’s oil industry and signed several other deals in the energy sector, but Beijing made no mention of new funds for Caracas during President Nicolas Maduro’s visit to his key financier on Friday.

Maduro’s leftist government sold a 9.9 percent stake in the low-cost Sinovensa joint venture, where China National Petroleum Corporation has a 40 percent share, to China, it said in a statement.

The statement also said China and Venezuela had signed a “memorandum for cooperation in Ayacucho bloc 6,” located in Venezuela’s vast oil-rich Orinoco Belt, without elaborating.

[thackney]

China has been putting money into this particular venture for quite a while.

https://china.aiddata.org/projects/38053?iframe=y

n order to accelerate the oil production in Venezuela, China Development Bank has agreed to provide $4 billion in loans to PDVSA. This new loan would have a maturity date of 8 years at a rate of LIBOR + 5 percent. The loan was intended to increase the rate of production from 330,000 barrels a day from 120,000 by 2014. The loan fuels an investment established on 17 April 2001 the joint-venture company Sinovensa, when CNPC and PDVSA reached an agreement to produce Orimulsion. The fuel is marketed as a replacement for coal or fuel oil in power plants. Most nations have decreased their consumption of the fuel, but China continues to invest and consume Orimulsion. CNPC holds 70 percent of equity in the project. This percent is slowing changing: in 2013, CNPC owned about 37.57% stake. However, the joint venture handles the fund directly, rather than being channeled through the state company or the government. On June 3rd, 2013, CNPC and PDVSA signed a 4.02 billion USD Financing agreement with China Development Bank. The money will be used for increasing the daily production of the joint-venture SINOVENSA from 140,000 barrels to 330,000 barrels....