Spain’s Repsol offers credit line to PDVSA for Petroquiriquire joint venture

Spanish ebergy company Repsol has offered a credit line of up to $1.2 billion to boost oil output at a joint venture it runs with Venezuelan state oil company Petroleos de Venezuela (PDVSA) according to the announcement of the companies on Friday.

The funds will be earmarked for the Petroquiriquire joint venture, where PDVSA held a 60-per cent stake and Repsol the rest.

The three fields in the states of Zulia, Trujillo, and Monagas currently averaged outputs of around 41,600 barrels per day, according to Repsol.

"Today we've achieved, after very long conversations, a financing deal that will allow us to double production," said PDVSA president Eulogio Del Pino after a signing ceremony at the Miraflores presidential palace in the capital Caracas, Reuters reported. He added the production was around 30,000 bpd.

Repsol confirmed the agreement whose negotiations had started three years ago.

"This agreement entails a credit line that will be used for investments at Petroquiriquire in the next five years," the company said in a statement later on Friday, mentioning drilling and well-reactiviation projects.

Meanwhile, shares of ConocoPhillips  (COP) traded lower in early-afternoon trading on Friday as the company sued Venezuela's state-run oil company Petroleos de Venezuela (PDVSA) over alleged fraudulent bond swaps, in US Federal Court in Delaware yesterday.

According to Conoco, PDVSA had sought to shuffle certain assets to avoid compensating creditors for the 2007 nationalisation of certain holdings, the Financial Times reported.

"The purpose behind each of these transfers is the same: to remove assets from the United States to Venezuela...with the intent to hinder, delay or defraud PDVSA's and Venezuela's arbitration award to creditors, including ConocoPhillips," the lawsuit states.

At least 20 companies had gone to arbitration against Venezuela over the 2007 seizures of oil projects in which the company sought to form long-term partnerships with US oil companies.