Chevron Corporation offered $2 billion as a loan to a joint venture with Venezuela’s state oil company in a highly invested attempt to boost oil production in western Zulia state, Fox News Latino reported.
Despite being home to the world’s largest oil reserves, Venezuela’s production rates have fallen over the past decade, the report said.
Rafael Ramirez, Oil Minister of Venezuela, signed the deal with Ali Moshiri, head of Chevron in Latin America.
The investment would seem risky to most, but the business parties seem to have everything under control. In fact, Ramirez revealed just why it’s necessary, saying that financing will help boost production in the Boscan field. Production should increase from 107,000 barrels a day to 127,000 barrels.
The increase could be coming at just the right time, since the Venezuelan government has relied heavily on the country’s oil income to fund social programs in the past, and has reinvested relatively little of it to exploit new fields and replace depleted ones.
Read more: http://latino.foxnews.com/latino/money/2013/05/28/chevron-and-venezuela-sign-2-billion-loan-deal/#ixzz2VTCcYp4t
(Photo by vl8189 via Flickr)