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Russia, Venezuela agree on $14 billion oil and gas deal

Staff writer |
President of Venezuela Nicolas Maduro says his country has reached an agreement with Russia, which will see investment of $14 billion in the oil and gas sector over the next few years.

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The agreement was reached between the Venezuelan state oil firm, PDVSA (Petroleos de Venezuela) and the Russian oil giant, Rosneft, after talks in the South American country’s capital, Caracas, between Maduro, the president of PDVSA, Eulogio Del Pino, and the president of Rosneft, Igor Sechin.

According to the Venezuelan president, the investment will be used to develop the so-called Orinoco Belt, which runs through the northeast and into the Caribbean Sea. The belt holds some of the largest crude oil reserves in the world. The two countries will also look into developing the Latin American nation’s gas sphere.

PDVSA had set an ambitious target to try and double the country’s oil production to 6 million barrels a day by 2019, which is 8 million tons a year. The figure in 2014 was just 1.6 million tons per year.

Four million of these barrels are expected to come from the Orinoco Belt. However, Maduro did not provide any details of how the investment plan would be put into practice.

The company also mentioned that Rosneft had proposed an increase of its stake in its subsidiary, Petromonagas. The Russian company currently owns 16.7 percent, but offered to increase this to 40 percent, which is the maximum allowed for a foreign partner in a joint oil venture in Venezuela.

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