Venezuela Oil and Gas Report Q4 2008Venezuela Oil and Gas Report Q4 2008 - adds new report
2008-11-13 09:35:01 - Venezuela Oil and Gas Report Q4 2008 - a new market research report on http://www.
www./Summary-Market-Report/Venezuela-Oil- ..
Production of 196bcm in 2007 should reach 279bcm in 2012, and implies 25bcm of net exports by the end of the period. Venezuela contributed 15.52% to 2007 regional gas consumption, while producing 14.48%. By 2012, it is expected to consume 20.33% of the region’s gas, while contributing 20.08% to supply. In Q208, we estimate that the OPEC basket price averaged just under US$115 per barrel (bbl) – up around 24% from the Q108 level. The OPEC basket price had exceeded US$127/bbl on the 22nd of May, slipping back towards US$121/bbl later in the month. In June, we assumed an average of around US$120/bbl, to deliver our quarterly estimate of US$114.98/bbl. The estimated Q208 average prices for the main marker blends are now US$118.63/bbl for Brent, US$119.61/bbl for WTI and US$115.89/bbl for Russian Urals (Mediterranean delivery). Our projections for 2008 as a whole have been revised upwards from the last quarterly report. We are now assuming an OPEC basket price average of US$106/bbl for 2008, compared with the US$81/bbl estimate provided by our last quarterly report. Based on recent price differentials, this implies Brent at US$109.71/bbl, WTI averaging US$110.64/bbl, and Urals at US$106.88/bbl. Real GDP growth is forecast at 5.8% for 2008, down from 8.4% in 2007. We are assuming 3.0% growth in 2009, 3.2% in 2010, followed by, 3.3% in 2011 and 3.5% in 2012. State-owned Petróleos de Venezuela (PdVSA) works in co-operation with numerous international oil company (IOC) partners in conventional and heavy oil projects. While recent re-nationalisation moves, changes in taxation and alterations to the licensing system have reduced foreign involvement, several key players appear committed to the country. We are assuming oil and gas liquids production of 2.93mn b/d by 2012, with the country expected to pump 2.75mn b/d in 2008. Consumption is forecast to increase by around 3% per annum to 2012, implying demand of 691,000b/d by this point. The export capability would thus be about 2.24mn b/d by 2012. Gas production is forecast to rise from 28.5bcm in 2007 to 56.0bcm over the period, allowing 4bcm of exports by 2012. Between 2007 and 2018, we are forecasting an increase in Venezuelan oil production of 28.2%, with liquids volumes rising steadily from 2.61mn b/d to 3.35mn b/d. Oil consumption between 2007 and 2018 is set to increase by 38.4%, with growth slowing to an assumed 3.0% per annum towards the end of the period and the country using 825,000b/d by 2018. Gas production is expected to rise steadily, from around 28bcm in 2007 to 78bcm in 2018. With demand growth of 145%, this implies export potential rising to more than 8bcm by 2018. Details of the new BMI 10-year forecasts can be found in the Appendix of this report, which provides global, regional and country-specific projections. Venezuela now ranks second in BMI’s newly revised Upstream Business Environment rating, having overtaken Peru thanks to its vast hydrocarbons resource base. It lags just one point behind Brazil, but is unlikely to take the regional lead unless the overall risk situation was to improve dramatically. Peru is only two points behind. As well as high scores for reserves, production growth potential and reserves-toproduction ratios (RPR), Venezuela benefits from the substantial (but decreasing) number of international companies active within its upstream industry. The country now ranks eighth in BMI’s updated Downstream Business Environment rating, reflecting its refining capacity, retail site intensity and growth in GDP per capita. Mexico, above, is within reach, but Ecuador – some five points behind – is in no position to challenge for eighth place. |
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