OREANDA-NEWS. With the aim of increasing production output to 127 thousand barrels per day at the joint venture Petroboscan, representatives of Petroleos de Venezuela S.A. (PDVSA) and Chevron International signed an agreement for a 2 billion dollars long term credit line at the anteroom of the Simon Bolivar Hall of the state oil company's headquarters in La Campina.

This agreement secures a corporate loan from Chevron to Petroboscan, a PDVSA affiliate. They have been working on it for almost a year and it constitutes “an ideal scheme for the financing of joint ventures, as it ties the loan to an increase in productivity”, explained Rafael Ramirez, People's minister of Petroleum and Mining during the signing ceremony.

“An increase in production is an indispensable condition for the payment of the loan. This way we force ourselves and we force our partner too, so that we all focus on the production increase which is our objective”, said Ramirez.

The president of PDVSA said that the financing provided by Chevron to Petroboscan will be long term. The last repayment is expected to be made by June 30, 2025 with a rate equivalent to LIBOR plus 4.5% without any other additional costs.

Currently, Petroboscan produces 107 thousand barrels per day of 10°API crude, which is normally used for the manufacturing of asphalt, in the Boscan mature field, located in Zulia state, in the western side of the country, exploited since 1947. Ramirez stated that all the necessary investments will be made to optimize the almost 100-year-old infrastructure.

PDVSA and Chevron are partners in Petroboscan with 60% and 40% of the shares respectively, in accordance with the law that since 2007 allows private companies to remain in the oil business as minority shareholders in joint projects with the Venezuelan state oil company.

Objective: boost production

This agreement adds up to 8 billion dollars the loans signed in the last few days by the Venezuelan state oil company to foster oil production in the country, said the head of the energy ministry.

Last May 15, China National Petroleum Corporation (CNPC) signed a 4 billion dollar agreement with PDVSA to boost crude production of the joint venture Petrolera Sinovensa, at the Carabobo area of the Faja Petrolifera del Orinoco (Orinoco Oil Belt), from 140 thousand barrels per day (Mbbls/d) that are being produced currently to 330 Mbbls/d in 2016.

Furthermore, in recent days the Russian state company Rosneft agreed to provide a 1.5 billion dollars financing to the Corporacion Venezolana de Petroleo (CVP), to reach a production of 400 Mbbls/d by 2019 in the joint venture Petrovictoria, of Russian and Venezuelan capital.

Also, Shlumberger agreed recently to provide a revolving line of credit in the initial amount of 1 billion dollars for the delivery of oil services to maintain and increase PDVSA activities and avoid interruptions due to cash flow problems.