Page 10 - LatAmOil Week 21 2022

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Iranian blendstock is reportedly in high demand at PdVSA’s El Palito refinery (Photo: PdVSA)

Iran, Venezuela move forward

with condensate swap deal

IRAN appears to be moving forward with blendstock deliveries to Venezuela. Citing data
implementation of the co-operation deal signed from the oil analytics firm Vortexa, Argus Media
during Oil Minister Javad Owji’s visit to Caracas reported last week that the Iranian tanker Dino
earlier this month. was expected to discharge 370,000 barrels of Ira-
That agreement provides for Iran to sup- nian Heavy crude at Venezuela’s Jose terminal
ply the South American country with refinery soon. This grade, which has a specific gravity
equipment, as well as assistance with overdue of 29.5 degrees API, is a lighter alternative to
work at the state-owned El Palito refinery in Venezuelan’s Merey grade, which has a specific
Carabobo. The 140,000 barrel per day (bpd) gravity of 16.2 degrees API.
facility has not been able to keep to its regular The recent uptick in Iranian shipments to
repair and maintenance schedule, as its owner, Venezuela is happening as Chinese demand for
the national oil company (NOC) PdVSA, is a Iranian crude slips as a consequence of lock-
target of US sanctions. downs related to coronavirus (COVID-19). This
The recently penned deal between Teh- drop in demand has freed up Iranian inventory,
ran and Caracas also provides for Iran to send and much of this has been rerouted to Venezuela
shipments of gas condensate to Venezuela instead. Whether this ramped up supply will
in exchange for Venezuelan crude. PdVSA is persist in the future remains to be seen, though.
already using Iranian condensate to dilute and As the main purchaser of both Iranian and
upgrade extra-heavy oil from the Orinoco belt Venezuelan crude exports, China has significant
into an exportable grade of synthetic crude. leverage over both nations’ export plans. Mean-
Since last autumn, deliveries of this blend- while, as Argus noted, there is another factor
stock have played a significant role in helping in play – the availability of extra cargoes from
Venezuela’s oil sector recover from the ravages Russia, which is another major supply source for
of the sanctions. As a result, production levels the Chinese market. In the event that Chinese
rose to 700,000 bpd in the first four months of buyers opt to purchase Russian Urals crude that
2022, marking a stark rise on the 470,000 bpd has been heavily discounted because of Western
figure posted in the same period of last year. sanctions, Iranian and Venezuelan exports to
Meanwhile, Iran is expanding the range of China could decline. ™

GUYANA
Repsol prepares for next well at Kanuku

REPSOL (Spain) is on track to spud Beebei-Po- Citing notices from Guyana’s Maritime
taro-1, its next exploration well at the Kanuku Administration Department (MARAD), the
block offshore Guyana, this week, according to news service said that Repsol was scheduled to
a report from OilNOW.gy. start drilling on or around May 25.

P10 www. NEWSBASE .com Week 21 26•May•2022