Venezuela’s PDVSA restarts drilling campaign suspended since 2019
In the second half of the year, Venezuela’s state-owned PDVSA will restart the drilling of oil wells while intensifying work to open 3,700 shuttered wells and to recover compression and gas injection capacity needed to increase crude output, according to an internal “Operational Follow-up Plan” report reviewed by S&P Global Platts.
The report contains details of the oil production recovery plan announced by oil minister Tareck el Aissami in February.
Venezuela’s oil output has fallen from an average of around 2.5 million barrels per day at the end of 2015 to 479,000 b/d in April as a result of disinvestment, lack of maintenance, general energy shortages and US sanctions. The Trump administration first sanctioned PDVSA in January 2019.
Venezuela’s Crumbling Oil Industry Is An Environmental Nightmare The near failure of the Venezuelan state, caused by the breakdown of the country’s oil industry, has triggered the second worst humanitarian crisis of the 21st century. While the collapse of Venezuela’s oil industry and what was once the richest economy in South America are well documented, there is little coverage of the immense environmental damage being caused by the decay of its energy infrastructure.
The autocratic Maduro regime is determined to squeeze whatever oil and gasoline production it can generate from Venezuela’s crumbling oilfields, corroded refineries and rusting pipelines. The situation is so dire that oil spills are a regular event in the near-failed state, especially since Washington ratcheted up sanctions, preventing Caracas from obtaining the capital required to conduct critical maintenance and overhauls. Under Maduro’s leadership Venezuela’s government, including national
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Can Venezuela Rebuild Its Crushed Downstream Sector? U.S. President Biden’s assumption of power has instilled a new sense of hope in Venezuela’s political leadership, with Nicolas Maduro stating that his country was willing to “walk a new path with Biden’s government”, provided that this path is based on mutual respect and understanding. Donald Trump’s tenure brought about an unprecedented decline in US-Venezuelan relations, even in his last day in presidential office Trump had a string of oil traders and 6 oil tankers added onto OFAC’s relevant sanctions list. Heretofore the new path has failed to materialize, Biden has reaffirmed the White House’s support for Juan Guaido and has renounced on the idea of meeting Chavez’s successor. However, the media hullabaloo surrounding the US elections has greatly helped PDVSA to rebuild some of its long-damaged refining infrastructure.
U.S. President Biden’s installation in the White House has gotten Venezuela’s leadership optimistic about the possibility of reviving its battered oil industry, and restart its domestic refineries