VENEZUELA - San Cristobal Venture.

PDVSA's Vice President for E&P Luis Vierma announced on June 28, 2005, that the state-owned company planned to produce 400,000 b/d of extra-heavy crude oil by 2008 at a new field in the east of the country and may decide to open the project to foreign investment. He said PDVSA had already begun building infrastructure at the San Cristobal field, north of Cerro Negro, which holds 18[degrees] API crude oil, and that the project was part of a plan to add to its oil production 1m b/d of heavy and extra-heavy crudes oil by 2010.

Vierma told reporters: "By 2010 we will have 1 million more barrels [a day] than what we have now". He was talking on the sidelines of a petroleum conference. PDVSA then was said to be planning to blend the San Cristobal crude oil with lighter crudes to make the oil marketable, or it may refine the crude in Venezuela.

Vierma said PDVSA had held talks with an Indian state oil company to form a JV to develop the San Cristobal field, but he said other oil firms may be interested as well, adding: "We're open to any type of a deal, but India has priority". It had been reported since March that the Indian state-owned Oil and Natural Gas Corp. (ONGC) was likely to get a 49% stake in an onshore oil exploration field in Venezuela. Indian Petroleum Minister Mani Shankar Aiyar said on March 4: "ONGC Videsh Ltd., the wholly owned unit of ONGC, is likely to get equity in the San Cristobal oilfield which has a production potential of 100,000 barrels a day". Ayar was talking to reporters after a meeting with visiting Venezuelan Foreign Minister Ali Rodriguez, adding: "The deal may be part of an inter-governmental agreement"

Aiyar said PDVSA could get equity in MRPL (Mangalore Refinery and Petrochemicals Ltd.), which can process Venezuelan crude oil. MRPL is a unit of ONGC and operates a 9.69m t/y refinery in the southern Indian state of Karnataka.