Venezuela, a country currently struggling with a pending economic collapse of mammoth proportions, has revealed that it is hurrying through a tender for billions of dollars’ worth of drilling contracts in a bid to boost oil production levels in the Orinoco Belt.
The South American country’s oil production has fallen a little each year for over 10 years, but its declines have ramped up this year due to cutbacks made by oilfield service companies, which in turn has led to a scarcity of funds in the sector.
At present, the country’s oil production is down to around 250,000 barrels each day in 2016, a figure that is roughly 330,000 barrels lower than average figures for the same area in 2015.
The dual effect of low oil prices and dropping production levels has pushed Venezuela to the economic brink, but in an attempt to plug the gap, Venezuela’s PDVSA, speaking on September 21, revealed that it had gifted $3.2bn worth of contracts to drill in the Orinoco Belt. According to PDVSA, this investment will lead to an increase of 250,000 barrels per pay within 2.5 years, sourced from approximately 480 wells.
The deal has also asked for drilling companies to cover the cost of drilling, for which they will then be compensated in later oil production.
PDVSA said that this drilling campaign is ‘one of the world’s largest drilling projects’.