Malaysia state oil firm Petronas is to pull out of the giant Carabobo project in Venezuela, it has been confirmed.
The company, which owned an 11% stake in the project, is reportedly dropping out of the project after a dispute over terms with Petroleos de Venezuela.
A Petronas spokesman confirmed the company had informed the Venezueland authorites of its exit from Carabobo.
The company had joined Spain’s Repsol SA, India’s Oil & Natural Gas Corp., Indian Oil Corp. and Oil India Ltd. to take a combined 40 percent interest in Venezuela’s Carabobo-1 project in the Orinoco heavy oil belt in February 2010.
Venezuela, which holds the world’s biggest crude oil reserves, has struggled to raise production. Output has dropped every year since 2007, according to the BP Statistical Review.
The Carabobo-1 project, of which PDVSA owns 60 percent, planned to produce 480,000 barrels of oil a day. The field requires $15 billion to develop and produce, according to the country’s oil minister Rafael Ramirez.
It was producing about 1,000 barrels a day in March, T.K. Ananth Kumar, finance director at Oil India, said at the time.
Ramirez yesterday declined to comment on Petronas’s exit.
Venezuela’s Orinoco belt extends over 55,314 square kilometers (21,357 square miles) and contains 257 billion barrels of proven heavy oil reserves, according to PDVSA.