http://biz.yahoo.com/prnews/050118/datu027_1.htmlHOUSTON, Jan. 18 /PRNewswire-FirstCall/ -- Harvest Natural Resources, Inc. (NYSE: HNR - News) today announced that its Venezuelan affiliate Harvest Vinccler C.A. (HVCA) intends to suspend drilling activities as a consequence of delays in receiving the permits necessary to drill additional wells.
The delayed approvals include permits to drill seven wells required to maintain and increase oil and gas production at its South Monagas Unit. In accordance with established procedures, HVCA submitted requests to Petroleos de Venezuela, S.A. (PDVSA) to obtain these permits from the Ministry of Petroleum and Energy. While PDVSA has not offered any definitive explanation for the permit delays, CVP, an affiliate of PDVSA, has sent HVCA a letter which seeks to reduce HVCA's 2005 drilling program budget below the amount previously approved and restrict production below planned levels. HVCA's current daily production is 29,000 barrels of oil and 80 million cubic feet of gas.
Harvest President and Chief Executive Officer, Dr. Peter J. Hill, said, "If the permitting approval delays continue or the capital programs or production levels are restricted, our 2005 production, earnings and cash flow projected in previously issued guidance would be adversely affected and would need to be revised. In accordance with our contract, we have a budget approved by PDVSA and have taken all steps to conduct our planned drilling program. We are attempting to meet with officials of the Venezuelan Government, Ministry of Petroleum and Energy and PDVSA to understand the reasons for these actions and to obtain the approvals necessary to proceed with our planned oil and gas development. Although the outcome of these efforts is uncertain at this time, we remain hopeful that these issues will be resolved based on our contract and the longstanding positive relationship with PDVSA and the current Administration. We think the recent appointment of a new board at PDVSA is positive, and we look forward to working with them."
Harvest will hold a conference call Tuesday, January 18, 2005 at 10:00 a.m. Central Time (11:00 a.m. Eastern Time). To access the call, dial 785-424-1051 five to ten minutes prior to the start time. A recording of the conference call will also be available for replay at 402-220-2987. To listen to the live webcast of the call, please visit our website at http://www.harvestnr.com .
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http://www.iags.org/n0118041.htm
In search of crude China goes to the Americas
Since it became a net oil importer in 1993, China has traversed the globe in a frantic quest for oil to fuel its booming economy. In some cases, its pursuit of oil has caused considerable irritation in Washington especially due to China's decision to support rogue regimes, such as Iran and Sudan, just because it depends on their oil. Now, China might be on the verge of causing even greater vexation by setting its sights on a new oil domain: the Western Hemisphere.
In recent months, Chinese state-owned oil companies have begun seeking ambitious oil deals in Canada - the top petroleum supplier to the U.S. - including the acquisition of Canadian energy companies. Sinopec, one of China's largest state-owned energy companies, is interested in buying stakes in the vast reserves of the Alberta oilsands. The Canadian giant Enbridge is pushing ahead with a plan to build a $2.5-billion pipeline to transport oil from Alberta to the coast of British Colombia from where it will be shipped across the Pacific to China. Though it is not clear which of these deals will come to fruition, the possibility of Chinese acquisition of portions of Canada's energy industry - which could lead to a loss of up to a third of Canada's potential exports to the U.S. - should be a source of concern in Washington.
This is especially true after another blow to U.S. energy security was delivered last month by Venezuela, America's fourth largest oil supplier. In his recent visit in Beijing, Venezuela's president Hugo Chavez signed new agreements allowing Chinese companies to explore for oil and gas and set up refineries in Venezuela. He said his country seeks to reduce its dependence on selling oil to the U.S. and would therefore like to give China greater access to Venezuelan natural resources: "We have been producing and exporting oil for more than 100 years but they have been years of dependence on the United States. Now we are free and we make our resources available to the great country of China."
As U.S. oil imports are projected to surge 70 percent during the next two decades due to demand growth and a decline in domestic crude production, the U.S. cannot afford to lose chunks of the crude produced by the two countries that together supply a third of its oil imports. But Chinese competition for this oil might cause just that. Furthermore, in its thirst for oil China is even weighing bidding for U.S. companies. According to the Financial Times China National Offshore Oil Corp, the country's third-largest oil and gas group is considering a $13 billion bid on Unocal, America's ninth-largest oil company.
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