Iran’s condensate to help Venezuela boost its oil output

October 2, 2021 - 13:26

TEHRAN – Venezuela is going to use the gas condensate imported from Iran to boost crude oil production at three key extra-heavy crude projects in its largest oil region, a senior company official told Reuters.

Wills Rangel, a PDVSA board member, and a union leader, said in a late Wednesday interview that the Iranian condensate would help boost crude output at oilfields associated with the Petrocedeno, Petropiar, and Petrolera Sinovensa projects, three of the company's largest.

As reported, the National Iranian Oil Company (NIOC) has reached a deal with Venezuelan state-run oil company PDVSA to swap Venezuelan crude for Iranian condensate, which PDVSA will use as a diluent and mix it with the tar-like crudes from the Orinoco oil belt for transportation and export.

"There are many inactive wells due to a lack of diluents," Rangel said in an interview at his office in capital Caracas. "We will reactivate production."

The diluent shortage is the latest obstacle to beset the OPEC nation's oil industry, which has seen production collapsed due to years of underinvestment. More recently, U.S. sanctions have cut the company off from key trade partners, including former suppliers of diluents.

The Iran-flagged tanker Dino I, which brought 2.1 million-barrel cargo of condensate, began discharging its first parcel this week for Sinovensa, according to a PDVSA schedule seen by Reuters.

Rangel estimated Venezuela's total crude production at 750,000 barrels per day (bpd), higher than the 641,000 bpd the country told OPEC it averaged in August. Venezuelan officials say they aim to boost output to 1 million bpd by year-end.

Iran had previously helped Venezuela meet its fuel needs by sending several gasoline cargoes to the country despite the U.S. sanctions on both sides.

In May 2020, Iran sent five oil tankers—Forest, Fortune, Petunia, Faxon, and Clavel—all under the flag of Iran, to Venezuela, followed by another tanker, Golsan, sent in June 2020. Since the collapse of Venezuela's oil refining industry and the 2019 sanctions imposed by the United States preventing fuel suppliers from sending gasoline to Venezuela, the country is experiencing a chronic shortage of gasoline. The Iranian tankers sent in May carried 1.53 million barrels of Iranian gasoline.

Natural-gas condensate, also called natural gas liquids, is a low-density mixture of hydrocarbon liquids that are present as gaseous components in the raw natural gas produced from many natural gas fields.