Credit concerns loom behind PDVSA's super-sized oil import tender
By Marianna Parraga
HOUSTON, March 11 (Reuters) - State-run PDVSA's biggest ever crude oil import tenders, launched this week, suggest the cash-strapped Venezuelan firm is hoping suppliers will shrug off concerns about payment capacity as it seeks to compensate for ailing oil processing equipment.
One of PDVSA's oil upgraders - a processing unit that converts extra heavy crude into higher-quality, exportable oil without the need to blend it with imported light oil - is working at half capacity, a company source told Reuters.
The tenders, which would more than double the OPEC member's imports in the second quarter, are a break with PDVSA's past practice of negotiating prompt spot deals to buy crude. Imports have become a growing necessity to dilute extra heavy oil output as PDVSA's medium and light crude output falls.
It may also be an effort to regain access to credit and get better delivery terms when planning longer-term purchases, as other Latin American oil importers do.
In two separate tenders this week, PDVSA asked traders for offers to sell it some 10.74 million barrels of Nigerian, Russian and U.S. crudes delivered to PDVSA's terminal in Curacao between April and June, according to trade sources.
The purchases would increase Venezuela's crude imports to some 118,000 barrels per day (bpd) compared with 50,000 bpd in 2015.
The increased volume may be partly explained by the fact that PDVSA's 130,000-bpd Petro San Felix upgrader - which accounts for more than a fifth of its total capacity - is currently working at 54 percent capacity due to equipment failures, a company source told Reuters.