Venezuela is important to world energy markets because it holds proven oil reserves of 65 billion barrel, plus as much as 1.2 trillion barrels of extra-heavy oil, including orimulsion. In the first half of 1997, Venezuela was the largest supplier of total U.S. oil imports (although Venezuela was #2 in crude oil only -- behind Mexico). Venezuela currently ranks as the world's sixth largest oil producer.

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GENERAL BACKGROUND
An economic turnaround appeared to gain momentum in 1997, with gross domestic product (GDP) predicted to rise by about 4.5%, following a decline of 1.6% in 1996. In addition, inflation is expected to fall from 100% in 1996 to 37% in 1997. Strong oil export revenues, both this year and in 1996, have helped to give Venezuela a large trade surplus and a steady source of foreign exchange. This has made Venezuela's foreign debt payment schedule easier to manage. (In 1997, Venezuela's total external public sector debt amortization totals $1.4 billion; this is expected to rise to $2.5 billion in 1998).

Venezuela's current economic upswing can be traced largely to President Rafael Caldera's decision (in April 1996) to shift economic strategy to a more free-market direction. This shift came as part of a $1.4 billion loan package from the International Monetary Fund (IMF), and was dubbed the "Agenda Venezuela." Major items in this "Agenda Venezuela" included: dismantling government wage and price controls; liberalizing foreign exchange; reducing the state deficit; cutting the federal workforce; and privatizing state industries on a wide scale. The government began by devaluing the currency, eliminating exchange controls (causing the Bolivar to plummet in value), and raising gasoline prices around 500% overnight. The Caldera government at the same time launched a fiscal austerity program in an attempt to revitalize Venezuela's economy, which has struggled in recent years.

Venezuela faces a challenge in maintaining its recent economic recovery. Among others, the Venezuelan government will need to push forward with often-unpopular reform measures, including the country's privatization program, originally begun in 1991. Also, continued high (although reduced) inflation will likely result in demands for wage increases. In March 1996, for instance, two work stoppages involving 850,000 public employees, as well as several large-scale protest marches, were held to protest the government's cooperation with the IMF as well as the country's deteriorating economic and social conditions. Since then, however, further social unrest -- which had been feared -- has not materialized. In an attempt to mitigate the effects of its austerity measures on the poor (who make up around 70% of the country's population), the Venezuelan government has, among other measures, increased public transport subsidies and has pledged to increase general government social spending from 0.5% of GDP to 2%.

Venezuela plans to establish a free-trade zone with Mexico and Colombia by 2004, and with the Central American Common Market by 2003. Efforts also have begun -- particularly between representatives from the two major South American trading blocs -- the Andean Community and the Mercosur pact -- to create a virtual South American Free Trade Area, or SAFTA. The Andean Community, which held its last summit in Sucre is made up of Venezuela, Ecuador, Colombia, and Bolivia, while Mercosur is currently composed of Argentina, Brazil, Paraguay, and Uruguay. Peru relinquished membership in the Andean Community in early 1997. Prior to Peru's departure, The Andean Community had a population of 83 million and a GDP of $142 billion. U.S. President Clinton is scheduled to visit Venezuela October 12, 1997, and to sign 12 bilateral accords, including one dealing with energy.

OIL
Privatization and increased foreign involvement continue to accelerate since the country's oil sector was opened to limited foreign participation in exploration and production in July 1995. Congressional support appears to exist for limited privatization of state-owned oil company PdVSA, while recent proposals have suggested eventual sale of up to half of Pequiven, PdVSA's petrochemical subsidiary. In September 1997, the Venezuelan government ordered PdVSA to merge its three largest subsidiaries -- Lagoven, Maraven, and Corpoven -- as part of a general restructuring of the company. The move is to take effect January 1, 1998.

As of August 1997, Venezuela was producing around 3.2 million barrels per day (bbl/d) of crude oil, far above its OPEC quota of 2.359 million bbl/d. About 40% of this was exported to the United States, which has become increasingly reliant on oil imports from the Western Hemisphere in recent years, and in 1996 imported more oil from Venezuela than from the entire Persian Gulf region. For the fourth quarter of 1997, Venezuela's total oil production capacity is expected to be around 3.3 million bbl/d, or nearly 1 million bbl/d above its official OPEC quota. Over the past three years, Venezuela has raised its oil production capacity by more than 200,000 bbl/d each year. Future increases in oil output are expected to come from the El Furrial Trend and the Orinoco Belt, both in eastern Venezuela. PdVSA also aims to double its output of petrochemicals by 2006 from 5 million tons currently.

In April 1996, PdVSA President Luis Giusti criticized OPEC's quota formula, and called into question Venezuela's continued participation in the organization. At the same time, Giusti praised moves towards oil sector integration in the Western Hemisphere. In late September 1997, Venezuela agreed with Trinidad to cooperate on oil and gas exploration in waters separating the two countries. Specifically, the Gulf of Paria and the Serpent's Mouth Channel are believed to hold some of the world's most promising reserves of oil and natural gas. The two countries also may cooperate on development in Orinoco and the Atlantic waters east of Trinidad. In mid-April 1997, tensions had flared when Venezuela accused a joint venture between Trinidad's state oil company and Texaco of conducting illegal exploratory drilling in Venezuelan waters, and sent an armed troop ship to board a drilling platform and a tugboat.

Venezuela has four major sedimentary basins containing proven conventional crude oil reserves of 64.9 billion barrels. Most oil production occurs in the Barinas-Apure basin, the Maracaibo basin, and the eastern basin. However, due to the maturity of many of these basins, PdVSA (the world's second largest oil company) spends over 50% of its production budget on the application of secondary and enhanced oil recovery techniques to maintain output levels. Medium and light crude oil comprise roughly 28% of this total, with the remainder consisting mainly of heavy crude oil with gravities of less than 20^oAPI. The largest heavy oil reserves are in the 270-mile long by 40-mile wide Orinoco Heavy Oil Belt in eastern Venezuela. Estimates of Orinoco's oil reserves range as high as 1.2 trillion barrels (in comparison, Saudi Arabia's reserves are currently estimated at 250 billion barrels), with 270 billion barrels considered commercially recoverable at the present time. An even smaller fraction of this amount is considered as part of Venezuela's 64.9 billion barrels in proven oil reserves.

As part of a $65 billion, 10-year expansion plan first announced in July 1995, PdVSA plans to increase its total oil production capacity to 6.4 million bbl/d by 2006 (from about 3.3 million bbl/d currently), including a shift to lighter, higher-value products. In order to finance these ambitious plans, Venezuela is counting on large-scale foreign investment. Twenty years after nationalizing its oil industry, Venezuela now has reversed course and is pushing to establish "strategic alliances" and "profit-sharing agreements" (PSAs) with foreign oil companies. Under PSAs, foreign companies would bear all exploration costs. There is a maximum nine-year exploration period in which a foreign company would be obligated to spend a minimum of $40 to $60 million per block. After a commercially viable oil discovery, a joint venture with PdVSA would be formed. The PdVSA affiliate would then take up to a 35% equity share in each joint venture. A company's total tax burden under a PSA would range between 85 to 94%.

In June 1997, PdVSA auctioned off operating rights on 18 of its mature fields. Five of these fields went to Venezuelan companies and thirteen to foreign companies, for a total of $2.2 billion. This was more than double PdVSA's original expectations, and prompted PdVSA to increase its estimate of eventual oil output from the 18 fields from 350,000 bbl/d to as high as 650,000 bbl/d.

As a result of the auction, Arco won the rights to four fields (twice in consortia with Polar and Inelectra in eastern Venezuela, and twice in consortia with Phillips Petroleum in western Venezuela). Phillips also won another field on its own. Statoil of Norway and Chevron will also participate in one of the Arco/Phillips consortia. The largest bid in the auction -- $453 million -- came from the U.K.'s Lasmo for the Dacion field (in eastern Venezuela), with an estimated output potential of 90,000 bbl/d. Spain's Repsol won the Mene Grande block for $330 million. Union Texas and Germany's Pressag acquired the rights to the Boqueron field, where the two companies hope to increase production from 8,500 bbl/d presently to 150,000 bbl/d within 3-5 years. Two western blocks -- Cretacico Sur and Bachaquero -- received no bids in the auction.

A new player on the scene, the China National Petroleum Company (CNPC), won the Intercampo Norte and Caracoles blocks for $358 million. CNPC already has an agreement with Bitor for the purchase of 1 million metric tons of orimulsion for use in Chinese industrial and electric power plants. China also is seriously considering purchasing 5.2 million metric tons per year of Orimulsion beginning in 2000, and has expressed interest in investing $300 million to build an Orimulsion-producing factory at Morichal, Monagas state, in eastern Venezuela.

Venezuela's latest bidding round marks the country's second major public oil and gas auction -- the first was in January 1996 -- since reopening to foreign companies (the "Apertura") in 1992/3. As a result of these auctions, PdVSA has now concluded billions of dollars in joint venture agreements with major international oil companies like Conoco, Mobil, Arco, and Total. Many more billions of dollars in foreign investment appear to be coming soon in other oil deals. In May 1997, for instance, Venezuela's Congress approved the legal framework for the $2.6 billion Cerro Negro oil venture between Lagoven, Mobil, and Veba in the Orinoco belt. Maraven is also working on completion of a $4.1 billion joint venture with France's Total, along with Norway's Norsk Hydro and Statoil. This joint venture would produce 180,000 bbl/d of 9^o API Orinoco crude and upgrade it into 30^o API synthetic light oil. Production of heavy crude would begin in 2000, with the upgrading plant slated for completion by 2002.

PdVSA's expansion plans place high priority on re-exploration and re-activation of marginal and inactive fields. Proven reserves in Venezuela's marginal fields are estimated at close to 2 billion barrels of light and medium crude oil. The geographic focus of this effort is in the Lake Maracaibo and Falcon basins in western Venezuela. Advanced technology is being applied to marginal field development. For example, horizontal wells in the Lake Maracaibo area have increased production eight-fold as compared to conventional wells. PdVSA also aims to develop the country's vast heavy oil reserves, particularly in the Orinoco Belt. PdVSA is counting heavily on foreign and private sector investment to achieve its goals.

In June 1995, DuPont's Conoco oil unit signed an agreement in principle with PdVSA's affiliate, Maraven on a $2.2-billion, 35-year joint venture (at which time ownership reverts 100% to Venezuela) to convert 9.5^oAPI crude oil from the Zuata region in the Orinoco Belt to 20-23^oAPI synthetic crude. The Petrozuata project's first production is expected to begin in late 1998, with upgrading capacity of 103,000 bbl/d expected by 2000. Of this, 64,000 bbl/d will be sent to Conoco's Lake Charles, Louisiana, refinery, with the remaining 39,000 bbl/d to be processed by Maraven at its Cardon refinery. Production is expected to peak at 125,000 bbl/d total, of which 105,000 bbl/d would be upgraded synthetic crude. The project involves drilling 500 horizontal wells and building a 125-mile pipeline from Zuata to the port of Jose on Venezuela's Caribbean coast.

In July 1997, Texaco Inc. announced that Venezuela's Congress had approved plans for a $3.5 billion joint venture to develop extra-heavy crude oil in the Hamaca Region of the Orinoco Heavy Oil Belt. The joint venture consortium includes Texaco, Arco, Phillips Petroleum, and Corpoven (a subsidiary of PdVSA). The project will produce 9^o API gravity crude oil in the Hamaca region and upgrade it to 25^o API, with characteristics similar to Alaska North Slope oil, for export to U.S. Gulf Coast refineries. The project will be implemented in three phases, with production beginning in early 1999 at 36,000 bbl/d, peaking at approximately 200,000 bbl/d in 2006.

In mid-September, 1996, Lagoven, another PdVSA subsidiary, agreed to a $2.3 billion, 100,000 bbl/d joint venture with Mobil to produce, upgrade, and market heavy crude from Orinoco beginning in 1999. The extra-heavy crude is to be processed at Mobil's 180,000 bbl/d Chalmette, Louisiana refinery. Mobil and Lagoven plan to produce 1.2 billion barrels of oil over the 35-year life of the project. Lagoven also is negotiating purchase of a 50% stake in the Chalmette refinery. Approval of Venezuela's Congress is needed before the Mobil-Lagoven deal is final.

In late August 1997, Conoco and PDVSA began drilling their first well in a 55,000-acre tract in the Orinoco belt. The project, which is run by Petrozuata (a joint venture between Conoco and Maraven) is to extract heavy oil from the Zuata region, transport it and upgrade it into a lighter, more marketable crude. Petrozuata expects to extract between 1.5 billion and 2 billion barrels of extra-heavy oil over 35 years.

Refining/Downstream
PdVSA is the world's fourth largest oil refiner, with a combined domestic and international capacity of 2.4 million bbl/d. After opening Venezuela's downstream sector to private investment in 1989, PdVSA began a 6-year, $2.8-billion, domestic refinery upgrade program aimed primarily at increasing the output of light products, such as gasoline, and to meet environmental restrictions imposed by the 1990 U.S. Clean Air Act. Following 1995 refinery upgrades, PdVSA now has a reformulated gasoline production capacity of about 200,000 bbl/d. About one-third of Venezuela's refined product exports are exported to the United States, where they are distributed mainly by Tulsa-based Citgo, PdVSA's U.S. refining and marketing subsidiary. With about 14,500 service stations throughout the United States, Citgo ranks as the largest U.S. gasoline retailer.

Two Venezuelan refineries currently undergoing or recently having been upgraded are Lagoven's 571,000-bbl/d Amuay refinery and Maraven's 286,000-bbl/d Punta Cardon refinery. At Amuay, roughly $630 million has been invested in a 34,000 bbl/d delayed coker which will reduce the refinery's proportion of residual fuel output. At Punta Cardon, Maraven spent around $2.1 billion to add a 48,000 bbl/d hydrotreater, a 60,000 bbl/d delayed coker, a 60,000 bbl/d reformer, and a sulfur recovery unit using Shell technology. The upgrading at Punta Cardon was intended to create a more favorable product mix, comprising 90% distillates and 10% fuel oil, as compared to the previous output of 70% distillates and 30% residuals. The new additions came online in early 1996.

In addition to domestic refinery upgrading, PdVSA is seeking to expand international refining capacity from the current 1.2 million bbl/d (including 1 million bbl/d in the United States) to 1.6 million bbl/d by 2002. Currently, PdVSA is active in the United States (through its Citgo and Uno-Ven joint ventures), Europe (including joint ventures with Ruhr Oel of Germany and Nynas), and increasingly throughout Latin America. Recently, PdVSA bought out Unocal's 50% share of their Uno-Ven joint venture, giving PdVSA full control of the 145,000 bbl/d Lemont refinery near Chicago. PdVSA also is said to be holding talks with Clark Refining and Marketing Inc. over the purchase of a stake in the company's 200,000 bbl/d Port Arthur, Texas refinery. Finally, Corpoven is looking to sign a deal with Amarada Hess to buy a 33% interest in Hess' St. Croix refinery.

In early 1997, a joint venture was established between Corpoven and Exxon to conduct a feasibility study on building a new refinery in Venezuela to upgrade extra-heavy crude oil from East Hamaca. In August 1997, Corpoven agreed with Phillips Petroleum to spend $500 million (beginning in 1998, with completion in 2000) to enable the Phillips refinery in Sweeny, Texas, to process heavy Venezuelan crude. Under terms of the deal, Corpoven would supply up to 165,000 bbl/d of heavy Merey crude for processing at the refinery. All of these projects are part of PdVSA's strategy to assume the dominant position in the U.S. Gulf Coast and Caribbean markets.

In another "downstream" area -- oil transport -- three large oil tankers (the Nissos Amorgos, Olympic Sponsor, and Corellis) ran aground in early 1997 in the channel connecting Lake Maracaibo with the Carribean, through which pass about 70% of Venezuela's oil exports. Through early September, two more oil tankers had run aground in the narrow, shallow channel, raising questions about the reliability of Venezuela's oil supply, as well as the risk and cost to shipping companies. For its part, the Venezuelan government has rejected heavy criticism over or responsibility for safety conditions in the channel.

Venezuela's Ministry of Energy and Mines has presented Congress with plans to liberalize domestic gasoline and diesel markets by gradually lifting state subsidies on these products, and by stripping PdVSA of its retail monopoly. The proposal has run into political opposition, especially given that an increase in the price of gasoline was one of the major factors behind large-scale riots in 1989. Despite this, prices on gasoline were raised on July 31, 1997. More than 60% of the sales price of gasoline goes to the government in the form of royalties and a consumption tax.

Orimulsion
Bitumenes de Orinoco (Bitor), a PdVSA subsidiary, manages the production and marketing of the country's boiler fuel, Orimulsion. Orimulsion is made up of natural bitumen (70%), water, and non-toxic additives. Bitumen is abundant in the Orinoco Belt. Bitor anticipates exports of up to 20 million tons of Orimulsion by 2000. In the long term, Bitor is planning to build three new Orimulsion production plants at a total cost of near $1 billion.

Bitor's main marketing objective for Orimulsion appears to be electric utilities -- particularly those planning to switch from fuel oil. For instance, Florida Power and Light (FP&L) signed a 20-year contract in April 1994 to buy 4.5 million tons per year starting by 1998. In April 1996, however, state officials in Florida blocked the deal for environmental reasons (orimulsion contains high levels of sulfur and other pollutants). FP&L appealed the decision, but as of September 1997 no decision had been reached (although Florida Governor Lawton Chiles has called a new hearing on the matter). Meanwhile, PdVSA has completed a technical feasibility study for building a nearly 2000-mile long, $3.6 billion pipeline to transport crude oil from eastern Venezuela to Florida.

In addition to FP&L, Asia is a major destination for Bitor's Orimulsion exports. Bitor currently holds three contracts with Japanese utilities to supply a total of 750,000 tons per year for five years. Bitor also is working on expanding into other Asian markets such as China and Thailand.

NATURAL GAS
In 1996, Venezuela produced an estimated 960 billion cubic feet (Bcf) of natural gas on proven reserves of 142 trillion cubic feet (Tcf). A recent study estimated that Venezuela's ultimate gas reserves may be as high as 458 Tcf, with 313 Tcf concentrated in the wedge-shaped Eastern Venezuela gas basin. Currently, about 60% of the country's gas production is consumed by the oil industry, which either re-injects the gas into oil fields or flares it. Power generation accounts for another 11% of Venezuela's gas consumption, with 6% going to petrochemical production and the rest going mainly to industrial or commercial customers. Venezuela would like to increase the consumption of domestically-produced natural gas, possibly through conversion of oil-fired power plants to gas, construction of new gas-fired plants, expansion of distribution networks, and an aggressive natural gas-powered vehicle program.

PdVSA hopes that field reactivation programs will spur natural gas production from the Maracaibo and Falcon basins. Overall, PdVSA aims to boost gas production 25% by 2005. A major roadblock to increasing Venezuelan gas production is price controls. Currently, natural gas sells to most domestic users for only 20 cents per thousand cubic feet (compared to over 6 dollars per thousand cubic feet in the United States, for instance). Other obstacles to increased gas production include legal barriers, regional competition, politics, and immature markets. As part of the Venezuela-Trinidad deal discussed above, Venezuela has shelved plans to build the proposed $4.9 billion Cristobal Colon liquefied natural gas (LNG) refinery, and instead will send its natural gas to a $1 billion LNG plant under construction in Trinidad.

COAL
Venezuela has recoverable coal reserves of approximately 460 million short tons (Mmst), most of which is bituminous. In 1996, coal production, almost all of which was exported (mainly to European markets), was estimated at 4.79 Mmst. Coal production has been limited during the last several years by strains on infrastructure and transportation. Coal production expansion plans focus on the Guasare region of the Zulia state in western Venezuela. The Guasare coal fields contain estimated 2.2 billion short tons of reserves with 280 Mmst of proven high quality, low sulfur, coal reserves. In an effort to increase coal production, Venezuela's largest coal mine company, Carbones del Guasare, C.A., has selected foreign partners to exploit Guasare, as well as the Mina Norte field (also located in Zulia).

Current coal production is centered at the Paso Diablo mine, which is run in a joint venture partnership between Carbozulia and Italy's Agip. State-owned Carbozulia, in a joint venture with Agip Carbone, Veba Oel, and Royal Dutch Shell, plans to increase production to roughly 13 Mmst per year by 1996 and over 20 Mmst by 2000. This added production will be targeted primarily for export, and will cost an estimated $1.7 billion. A portion of this money will be used to construct a 30-mile railway to a proposed export terminal on the La Guajira peninsula near Lake Maracaibo. The large Socuy mine also is projected to expand its production to 5 Mmst by 1998. The partners in this venture are Shell and Veba. Two other projects involve expansion of the smaller, nearby Mina Norte and Cachiri mines, whose output would be raised to around 2 Mmst per year at most.

ELECTRICITY
Venezuela has 20 gigawatts of electric generating capacity, of which about 60% is hydropower. The electricity sector is a hybrid of state-owned and private companies, combined with a fully integrated distribution system of 875 KV, 400 KV, 230 KV, and 115 KV transmission lines. Edelca is the Venezuelan state-owned power company.

The largest private utility, Electricidad de Caracas (EdC), serves nearly 1 million customers in the Caracas metropolitan area. EdC is also the largest private company in the country, and has taken steps to expand outside the country. In May 1997, EdC, along with Houston Industries, bought 56.7% of Colombia's

Empresa Electrica del Pacifico, with 900 megawatts of installed generating capacity, for $498 million. EdC has been motivated to expand outside the country largely because the Venezuelan government has refused to grant tariff increases for domestic service that keep pace with inflation. In June 1997, Venezuela raised natural gas prices, further cutting into EdC's bottom line.

Venezuela has taken initial steps toward privatizing and reorganizing its state-owned power sector companies (including legislation submitted to Congress in April 1997), but the process has been delayed several times. On September 22, 1997, however, the Venezuelan Investment Fund (which runs the government's privatization program) announced that it would open bidding by companies or consortia on the state of Nueva Esparta's electric system. Nueva Esparta's privatization is to kick off the government's privatization of many electric power sector companies and assets.

Hydroelectric's share of power generation is expected to grow as Venezuela adds about 8 gigawatts over the next 5-10 years. With hydropower potential estimated at 70 to 80 gigawatts or more, Venezuela has plans for several additional plants. These include the $2.1 billion, 2,160-MW Carachi plant, one of three (along with Macagua and Tacoma) large hydropower projects planned for the Caron River, which begins near the border with Brazil and extends 400 miles to the Orinoco River. The final 135 miles of the Caron, known as the lower Caron, has a hydroelectric potential of 18,665 MW. Currently, La Guira dam, with a capacity of 10,000 MW, is the largest hydroelectric plant in the country. La Guira is also a candidate for possible privatization by the government.

ENERGY EFFICIENCY/ENVIRONMENT
Venezuela's Ministry of Energy and Mines, along with Fontur, a transportation organization, are developing a project to improve overall energy efficiency in the public transportation sector. The main goal of this $15 million, 5-year, project is to replace old vehicles with newer, more efficient ones.

In early 1996, Maraven announced a $20 million, 3-6 year, waste disposal project beginning in the second quarter, when new national environmental regulations came into effect. The project is located on the eastern shore of Lake Maracaibo, where Maraven produces 900,000 bbl/d of crude oil, along with millions of tons of sludge, drilling mud, and other waste materials. Lake Maracaibo is heavily polluted due to years of contamination from high levels of industrial waste discharges.

COUNTRY OVERVIEW
President: Rafael Caldera Rodriguez
Finance Minister: Luis Raul Matos Azocar
Independence: July 5, 1811 (from Spain)
Population (1997E): 22.5 million
Location/Size: Northern South America/352,144 square miles, slightly more than twice the size of California
Major Cities: Caracas (capital), Maracaibo, Valencia, Maracay, Barquisimento
Languages: Spanish (official), Indian dialects in the interior
Ethnic Groups: Mestizo (67%), white (21%), black (10%), Amerindian (2%)
Religions: Roman Catholic (96%), Protestant (2%)
Defense (6/95): Army (34,000), Navy (15,000), Air Force (7,000), National Guard (23,000)

ECONOMIC OVERVIEW
Currency: Bolivar
Official Exchange Rate (9/15/97): US$1 = 496.3 bolivars
Gross Domestic Product (GDP- market exchange rate, 1996): $64.2 billion
Real GDP Growth Rate (1997E): 4.5%
Inflation Rate (consumer prices)(1997E): 37%
Current Account Balance (1997E): $4 billion
Major Trading Partners: United States, Germany, Japan, Canada, Italy, Colombia
Merchandise Exports (1996E): $18.9 billion
Merchandise Imports (1996E): $10.9 billion
Major Export Products: Petroleum, aluminum, bauxite, steel, chemicals, and agricultural products
Major Import Products: Machinery, semi-finished manufactured goods, chemicals, foodstuffs
Oil Export Revenues/Total Export Revenues (1997E): 77%
Foreign Exchange Reserves (12/96E): $15.3 billion
Foreign Currency Debt (1997E): $30 billion

ENERGY OVERVIEW
Minister of Energy and Mines: Erwin Jose Arrieta Valera
Proven Oil Reserves (1/1/97): 64.9 billion barrels
Oil Production (1H97E): 3.33 million barrels per day (bbl/d), of which 3.17 million bbl/d was crude oil
OPEC Crude Oil Production Quota (1997): 2.359 million bbl/d
Oil Production Capacity (4Q96E): 3.3 million bbl/d
Oil Consumption (1997E): 450,000 bbl/d
Net Oil Exports (1997E): 2.9 million bbl/d
Crude Oil Refining Capacity (1/1/97): 1.2 million bbl/d
Major Crude Oil Customers: United States, Germany, Canada, and Italy
Oil Exports to the United States (1H97): 1.7 million bbl/d
Natural Gas Reserves (1/1/97): 141.6 trillion cubic feet (Tcf)
Natural Gas Production (1996E): 0.96 Tcf
Natural Gas Consumption (1996E): 0.96 Tcf
Coal Reserves (12/31/93): 460 million short tons (Mmst)
Coal Production (1996E): 5.29 Mmst
Coal Consumption (1996E): 0.81 Mmst
Electric Generation Capacity (1/1/96E): 20 gigawatts
Electricity Production (1996E): 73 terawatthours

ENVIRONMENT OVERVIEW
Total Energy Consumption (1995E): 2.5 quadrillion Btu
Energy Consumption per 1987 Dollar of GDP (1995E): 44.3 thousand Btu (vs. 16.2 thousand Btu in U.S.)
Energy Consumption per Capita (1995E): 117.1 million Btu (vs. 345.9 million Btu in U.S.)
Energy-related Carbon Emissions (1995E): 32.0 million metric tons (0.5% of world carbon emissions)
Carbon Emissions per Thousand 1987 Dollars of GDP (1995E): 0.58 metric tons (vs. 0.28 metric tons in U.S.)
Carbon Emissions per Capita (1995E): 1.5 metric tons (vs. 5.4 metric tons in U.S.)
Major Environmental Issues: Deforestation, soil degradation, and urban, industrial, and freshwater pollution

OIL AND GAS INDUSTRIES
Organizations: The Ministry of Energy and Mines is both the owner and sole shareholder of Petroleos de Venezuela, S.A. (PdVSA). PdVSA itself is a holding company with three operating affiliates: Lagoven; Maraven; and Corpoven. PdVSA has nine subsidiaries including Bitor, Interven, and Pequiven, which manage Orimulsion production and distribution, PdVSA's foreign operations, and the petrochemical industry, respectively.
Major Foreign Oil Company Involvement: Arco, British Petroleum, Chevron, China National Petroleum Company, Conoco, Exxon, Mobil, Occidental, Shell, and Total.
Major Refineries (capacity-bbl/d) (1/1/97): Judibana (Amuay) (571,000), Punta Cardon (286,000), Puerto La Cruz (195,000), El Palito (115,000)
Major Oil Fields: Lagunillas, Bachaquero, El Furrial, Centro, Mulata, Lama
Oil Terminals: El Palito, Judibana (Amuay), La Salina, Maracaibo, Puerto La Cruz, Puerto Miranda, Punta Cardon

Links to other sites:
1997 CIA World Factbook - Venezuela
U.S. International Trade Administration, Country Commercial Guide - Venezuela
U.S. Department of Energy's Office of Fossil Energy's International section - Venezuela
U.S. International Trade Administration, Office of Latin America and Caribbean

The following links are provided solely as a service to our customers, and therefore should not be construed as advocating or reflecting any position of the Energy Information Administration (EIA) or the United States Government. In addition, EIA does not guarantee the content or accuracy of any information presented in linked sites.

PdVsa Venezuela's state-owned oil company
LatinWorld's section on Venezuela
Bitor's homepage on its Orimulsion project
Information on Venezuela from the Latin America Network Information Center
Petroleum Guide of Venezuela
Venezuela Oil and Energy

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File last modified: September 29, 1997

Contact:

Lowell Feld
lfeld@eia.doe.gov
Phone: (202)586-9502
Fax: (202)586-9753