Venezuelan crude deliveries to Citgo could rise by 100,000 bpd

Deliveries of Venezuelan crude to state oil firm PdVSA's US refining and distribution arm Citgo have not been interrupted as a result of a diplomatic spat with the Washington and could even increase by 100,000 bpd in March, PdVSA deputy president for trade and supply Asdrubal Chavez told.
Chavez, who is the cousin of President Hugo Chavez, told Venezuela's national assembly last year he would seek to increase the amount of Venezuelan crude Citgo processes in order to reduce purchases of pricier Canadian and/or Mexican crude.

However, after a recent diplomatic spat between Washington and Caracas, which resulted in one diplomat from each side being expelled, some believed PdVSA would actually reduce the amount of crude it sends to the US.
Chavez said that of the 1.5 mm bpd of crude and oil products PdVSA sends to the US every day, about 1 mm bpd is still processed at Citgo refineries or refineries affiliated to PdVSA such as Hovensa (a partnership with Amerada Hess based in the US Virgin Islands) and Chalmette (a similar deal with US major ExxonMobil in Louisiana).
Asked if the recent impasse had affected deliveries to Citgo, he answered: "No, not at all. Right now we are negotiating new contracts with Citgo to include additional barrels of Venezuelan crude."

By the end of March, PdVSA could increase shipments to Citgo refineries by some 50,000 bpd to 100,000 bpd on top of the additional 40,000 bpd it started sending last year to substitute Canadian and/or Mexican crude, Chavez said. Chavez also said that Venezuela could significantly increase its liquid fuels exports by 2008 thanks to a plan for increased natural gas usage in thermal generation and other industries.
"By 2008 we will get more gas and there will be a decrease in the usage of liquids [in the domestic market], so we will have more capacity to export," he said.

According to government figures, increased use of natural gas could free up some 100,000 bpd of liquid fuels. By 2008-2009 Venezuela plans to produce some 11bn cf a day of natural gas, up from some 7 bn cfpd at present, according to national gas regulator Enagas.
Besides eight refining facilities, Citgo also banners about 14,000 gas stations in the continental US and Puerto Rico.