Miami 5 de enero del 2019
In my opinion I do not think the oil production in Venezuela could ever go back to what it was, there are no efficient and knowledgeable people in the industry, most have gone to other countries where, even the non professionals make a lot more money, so without people that knows the business is impossible to recuperate any production, much lies the light and medium oils, simply because there are no maps, no well files, no logs of wells, and you are working on the dark. it becomes both expensive and dangerous to enter old producing wells not knowing what is there inside. we will have to get confidence of investors to come here and invest in new oil production, by drilling new wells, and keeping maps, files etc up to date. I know one area where gulf oil had two blowouts, PATO, south west of Cantaura city in Eastern Venezuela, I was a field engineer for production and tried to test the flow of the well through a portable testing equipment, but this equipment was not large enough to measure the amount of oil being blown out of the well, I estimated 6000 bbls. per day and lots of gas, of around 40 degrees API, 5000 psi at the well head, the well had just penetrated the J formation of the oficina sands, so there was possible that more oil was at the U sands level of the merecure formation, at around 20.000 ft. all information disappeared from the files, but like I said, you need confidence, and with this government is very difficult to have CONFIDENCE to come and invest in that area, another two promising areas are of the Orinoco delta, near Guyana discoveries, and in lake Maracaibo north west areas.
So there is no oil company really in Venezuela, they are producing what the wells continue to produce, and will continue to decline, because there in no replacement of the natural decline which runs around 20% per year. some old areas could be given on operational contracts to restore production to smaller companies that can risk to increase production in them, as we did in 1993, that some areas were given to private companies, PDVSA conserving the oil, and paying for barrell produced, and this was very good, these areas did no produce at all and a few years later provided 400.000 barrels per day.
So, we have to wait and see what happens in the country's politics, to do anything long lasting as it was before nationalization, the nationalization was an error, the government was taking 94% of the income of the international oil companies, and off course no one would be willing to invest any more, but the correct solution was to negotiate with the oil companies what take did the wanted, may be 20% would have kept them here, but politicians, as always push for nationalization and everyone followed the idea, which started interfering the oil company board of directors with politicians, who new nothing about the business, the affiliates companies were far from the government which controlled only the PDVSA board of directors, but not the boards of the affiliates, and that was eroded slowly, till the were eliminated by Luis Giusti, and them the government had complete control of all the industry, a lesson was learned, but a lot of politicians are blind to this and not enough people are brave enough to write about this because of repressions from government police.
This theme is long and bumpy and in this few words I tried to make a resume of the recent history.
Regards,
Nestor G Ramirez
