Chevron Boosts VZ Heavy Oil Stake to Feed U.S. Refineries


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) -- Chevron Corp has announced a strategic asset swap with 
Venezuela's PDVSA that would consolidate its footprint in the heavy oil sector 
of that country and bolster long-term supply to U.S. Gulf Coast refineries.

   Chevron signed Tuesday (4/13) a strategic swap to exit Venezuelan gas and 
minor oil ventures in exchange for increased ownership and new drilling rights 
in the country's high-yield heavy oil belt. Under the deal, Chevron increases 
to 49% its stake in the Petroindependencia joint venture and gains development 
rights for the Ayacucho 8 area in the Orinoco Oil Belt.

   The consolidation is a tactical pivot for Chevron, which under existing U.S. 
federal licenses, exports nearly all of its share of Venezuelan oil to the 
United States. Extra-heavy crude from the Orinoco region is a critical 
feedstock for U.S. refineries designed to crack dense, sour grades into 
high-value transportation fuels.

   U.S. imports of Venezuelan oil hit a seven-year high of nearly 550,000 bpd 
in late March, continuing a climb seen since February, after the White House 
assumed control of that country's petroleum sector following the detention of 
former Venezuelan President Nicols Maduro earlier in the year.




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