PDVSA (VZ state oil company) closes production as its operations crumble

[GatoGordo]

PDVSA closes production as its operations crumble
Jun 18 2018, 7:38 a.m.


Every week the crisis in Venezuela gets worse.

By Nick Cunningham on Oilprice.com | Free English translation by lapatilla.com

Now there are indications that your oil industry is entering a new and dangerous phase. Argus Media reports that PDVSA has begun to "proactively shut down oil production to cope with the almost full storage of its terminals, which further accelerates the decline in production and brings the OPEC country closer to the psychological barrier of 1 million of b/d production"

Venezuela's oil production fell to an average of 1,392 million barrels per day in May, a decrease of another 42,000 bpd from the previous month, according to OPEC secondary sources. However, with the crisis in Venezuela spiraling out of control at a horrible rate, the May figures may well have been a year ago.

The May figures do not reflect all the ramifications and implications of having to deal with inadequate port capacity, after Pdvsa diverted operations to Venezuela from its refineries and storage facilities in the Caribbean islands after ConocoPhillips obtained court orders of confiscation of products for the complaint that maintains against Venezuela when obtaining an arbitral award of the International Chamber of Commerce (ICC), for a total amount of 2,040 million US dollars.

The problem of export capacity has become so acute that PDVSA is demanding that its customers send ships that can handle cargoes from ship to ship , since there is a delay of ships trying to load in the decrepit ports of the country. PDVSA is even considering declaring force majeure in contracts that it will not be able to comply with. The result is that PDVSA could only have 694,000 bpd available for export in June, which is less than half of the 1,495 million b/d it is contractually obligated to deliver this month.

As such, the figure of 1,392 million b/d for May, however bad, is unfortunately outdated. Sources told Argus Media that production plummeted to just 1.1-1.2 million b/d in early June, falling to 1 million b/d.

-snip-

https://www.lapatilla.com/2018/06/18/pdvsa-cierra-produccion-en-la-medida-que-sus-operaciones-se-desmoronan/

BTW, this is what the extremist darling of Colombia (Petro) wanted so much, and admired about Chavismo. The wholesale nationalization and confiscation (for the Glory of the Revolution!) of every bit of profitability in any company and flushing it down the sh*tter. PdVSA jobs used to be the "Golden Ring". Now, employees are fleeing jobs that pay less than $2 per month.