Thursday, 6 June 2013

VENEZUELA NEGOTIATING SECOND $4 BILLION LOAN FROM CHINA


[source]

Venezuela is negotiating a $4 billion credit line from the Export-Import Bank of China that would be used for purchasing oil-field equipment, the South American country's state energy company Petróleos de Venezuela SA, or PDVSA, said Wednesday.

The deal adds to a separate $4 billion loan that PDVSA will receive from the Chinese government to boost oil production at Petrolera Sinovensa, a joint venture in Venezuela's vast Orinoco heavy-oil belt.

The latest credit line was discussed by bank president Li Ruogu and Venezuela Oil Minister Rafael Ramírez, who concluded a tour of the Asian nation Wednesday.

Venezuela has secured a number of financing agreements with its partners, ranging from Russia's Rosneft to U.S. oil major ChevronCorp., over the past few weeks as it looks for funding for its plans to rapidly boost production capacity over the next decade. The Venezuelan government says it produces close to 3 million barrels of crude oil a day and wants to raise that to 4 million over the next few years, with the biggest increase coming from the Orinoco region.

China has been an important partner for Venezuela, granting the resource-rich country nearly $40 billion in loans in recent years in exchange for oil shipments.

Mr. Ramirez has said that Venezuela currently sends more than 600,000 barrels of oil a day to China and aims to reach 1 million barrels a day within a couple of years.

In a statement, PDVSA said Mr. Ramirez met with officials from China's Citic Group, who also offered financing to begin laying out infrastructure plans for developing and extracting Venezuela's mineral deposits.

Last year, Venezuelan officials said Citic would work with Venezuela to develop the Las Cristinas gold mine.

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