AGL 40.00 Decreased By ▼ -0.16 (-0.4%)
AIRLINK 129.53 Decreased By ▼ -2.20 (-1.67%)
BOP 6.68 Decreased By ▼ -0.01 (-0.15%)
CNERGY 4.63 Increased By ▲ 0.16 (3.58%)
DCL 8.94 Increased By ▲ 0.12 (1.36%)
DFML 41.69 Increased By ▲ 1.08 (2.66%)
DGKC 83.77 Decreased By ▼ -0.31 (-0.37%)
FCCL 32.77 Increased By ▲ 0.43 (1.33%)
FFBL 75.47 Increased By ▲ 6.86 (10%)
FFL 11.47 Increased By ▲ 0.12 (1.06%)
HUBC 110.55 Decreased By ▼ -1.21 (-1.08%)
HUMNL 14.56 Increased By ▲ 0.25 (1.75%)
KEL 5.39 Increased By ▲ 0.17 (3.26%)
KOSM 8.40 Decreased By ▼ -0.58 (-6.46%)
MLCF 39.79 Increased By ▲ 0.36 (0.91%)
NBP 60.29 No Change ▼ 0.00 (0%)
OGDC 199.66 Increased By ▲ 4.72 (2.42%)
PAEL 26.65 Decreased By ▼ -0.04 (-0.15%)
PIBTL 7.66 Increased By ▲ 0.18 (2.41%)
PPL 157.92 Increased By ▲ 2.15 (1.38%)
PRL 26.73 Increased By ▲ 0.05 (0.19%)
PTC 18.46 Increased By ▲ 0.16 (0.87%)
SEARL 82.44 Decreased By ▼ -0.58 (-0.7%)
TELE 8.31 Increased By ▲ 0.08 (0.97%)
TOMCL 34.51 Decreased By ▼ -0.04 (-0.12%)
TPLP 9.06 Increased By ▲ 0.25 (2.84%)
TREET 17.47 Increased By ▲ 0.77 (4.61%)
TRG 61.32 Decreased By ▼ -1.13 (-1.81%)
UNITY 27.43 Decreased By ▼ -0.01 (-0.04%)
WTL 1.38 Increased By ▲ 0.10 (7.81%)
BR100 10,407 Increased By 220 (2.16%)
BR30 31,713 Increased By 377.1 (1.2%)
KSE100 97,328 Increased By 1781.9 (1.86%)
KSE30 30,192 Increased By 614.4 (2.08%)

CARACAS: Venezuela's crucial oil upgraders have stopped processing heavy crude because a decline in exports due to US sanctions has left the OPEC nation without sufficient storage space, seven sources familiar with the facilities told Reuters.

Three of the four upgraders, which convert extra-heavy Orinoco oil into lighter exportable grades, have started "recirculating" - a process that keeps systems running to prevent damage but does not yield new upgraded oil.

The shift signals that state oil company PDVSA is struggling to maintain operations after US sanctions this year eliminated its main customer by restricting sales to US refiners.

"The upgraders are recirculating because there is an excess of production, and there are no buyers," one PDVSA source said.

None of Venezuela's upgraders are processing crude, the sources said.

Three upgraders, which are part-owned by foreign companies Chevron of the US, France's Total, Norway's Equinor and Russia's Rosneft, are in recirculation mode. The fourth, fully owned by PDVSA, has been offline for months.

A separate facility that blends Orinoco crude with lighter grades, a joint venture between PDVSA and China's state-run CNPC called Sinovensa, was producing around 70,000 bpd of exportable crude as of May 14, according to one of the sources.

That was down from about 100,000 bpd earlier this year, the source said.

"Everyone is at zero except for Sinovensa," said a source at one of the joint ventures.

Neither PDVSA nor Venezuela's oil ministry responded to requests for comment.

Total, Rosneft and CNPC did not respond to requests for comment. Chevron and Equinor deferred comment to PDVSA.

The difficulty finding buyers prompted crude inventories at Venezuela's main export terminal, Jose, to rise to 1.9 million barrels late last week, their highest level in at least three months and up nearly 20 percent from the end of April, according to consultancy Kpler.

Inventories dipped earlier this week but are still above 1.8 million barrels.

To be sure, there is also a "major maintenance program" under way at the Jose terminal through May 21, according to an internal PDVSA document, also contributing to the drop in exports.

Trade publication Argus first reported that the upgraders had begun recirculating and added that PDVSA was evaluating plans to transform them into less complex blending facilities due to chronic equipment breakdowns, citing a senior company official.

The upgraders had increased output in April after being forced offline multiple times in March due to devastating nationwide blackouts.

Copyright Reuters, 2019

Comments

Comments are closed.