Venezuela threatened to sever ties with Spanish companies. Some links that involve more than 120 Spanish companies with investments that exceed 500 million euros. But the sector that could have the greatest impact is energetic And Repsol There is a key role. Venezuela’s coverage rate in trade is extremely volatile because it depends mainly on the volume of oil imports made by Repsol.
“It is a company that has been present in Venezuela for more than 30 years and manages several crude oil and gas assets in the development and production phase. The gas extracted by Repsol remains in the country, it is intended for the energy supply of the Venezuelan population. and is pay “in kind” with the exploitation of several crude oil fields,” sources close to Repsol explained to EL ESPAÑOL-Invertia.
In May 2023, it increased its participation by receiving authorization from the United States to extract Venezuelan crude oil and process it in its refineries. “In this way, Repsol will be able to recover the accumulated debts of the Latin American country,” they add.
The permissions, in reality, were exemptions to US sanctions against Venezuela’s oil industry, which have restricted the OPEC country’s oil exports since 2019.
Therefore, “if Venezuela cancels its relations with Repsol, it could mean that its population could find itself without energy supply, because it does not have more gas for its thermal power plants,” the same sources warn.
Energy in Venezuela
Oil is by far Venezuela’s main export. The Venezuelan economy has historically been heavily dependent on the oil industry and currently accounts for 27% of GDP, according to data from last May. ICEX (Spain Export and Investment).
In fact, tax revenues from oil activity have represented, on average, in recent years 70% of state revenues.
Mismanagement, corruption, lack of investment and maintenance of facilities, as well as US sanctions against the country’s public sector in an attempt to democratize it, have caused Venezuela to lose more than half of its oil production in recent years, according to the document from this Spanish organization.
And in 2023, Spain was its third main customer (11%), just behind the United States, with a share of 60%, followed by China (11%).
Currently, the need of the world market to replace Russian crude oil, in the face of sanctions, has made Venezuelan oil exports more attractive to cover the new market deficit. Compared to 2022, Venezuelan production increased by 9.4%.
Most of the increase in oil production observed in 2023 can be attributed to Chevronwhich has been increasing its production in Venezuela since November 2022, when the license was granted.
US sanctions.
As a result of Barbados Agreement (October 17, 2023)The United States issued a series of temporary licenses that ease sanctions by, among other things, authorizing the production, sale and export of crude oil and gas and lifting the ban on secondary trading of certain government bonds and notes. PDVSA (Petróleos de Venezuela, SA)The easing of sanctions on the energy sector has represented a significant additional income for the country, as it has allowed it to sell and collect crude oil at market conditions, as well as increase production, which would improve cash flow.
Spanish energy companies
With RepsolICEX lists up to a dozen companies dedicated to the hydrocarbon sector with a Spanish brand.
Betico Compressorswhich is dedicated to the development of fluid handling equipment and machinery for the oil industry, and Comins Global Corporationwhich provides general construction or mining services.
The most internationally known is Hard Felguerawhose activity focuses on the construction, operation and/or maintenance of power plants, prospecting and mining machinery and equipment, as well as fuels and lubricants. And there are also Elecnorwhich offers integrated electrical engineering services.
Industries like this Ferroatlantique Groupis present in Venezuela and focuses on the development of metallic and non-metallic minerals (except copper and zinc), and Isotron for the construction, operation and/or maintenance of dams and hydroelectric power plants, power transmission lines and substations.
Other Spanish companies are SDV Energy and Infrastructurepromoter and developer of energy projects, as well as builder of transmission lines and electrical substations.
Finally, they appear in the list Serprotech Energy Groupfocused on machinery and equipment for the oil industry, power engineering, as well as oil and gas installation, maintenance and distribution services, and Sugar Energy Latamfor Fuels and lubricants.
Hydrocarbons.
Venezuela has one of the the largest oil reserves in the world (about 300,000 million barrels) and the export of crude oil is an important source of income. In addition, it is the eighth country with the largest natural gas reserves in the world.
