Transcript Cross Border Developments Unitization 101

Energy Security in the Western Hemisphere:
Venezuela as the Cornerstone
Ali Moshiri
President ChevronTexaco Latin America
Washington, June 22 2004
© ChevronTexaco 2004
Confidential
The world is growing faster than we think
The world will grow 50% by 2050
Confidential
2
Population growth requires energy growth
Total World Energy Demand
120
Million Barrels of Oil Equivalent per Day
100
Oil
80
60
Coal
Natural Gas
40
Renewable, Hydro, Etc
20
Nuclear
0
1980
1985
1990
1995
2000
2005
2010
2015
2020
Oil and Gas are growing at 1.9 and 2.2% respectively
Confidential
3
Naturally, the global energy supply/demand is in
balance
Worldwide Oil Consumption: Approximate 75,000 MMBOD
2000
Oil Resources (Bbbl)
1500
1000
500
0
Discovered
Undiscovered
Resrves Growth
Total
US Geological survey has 2 Trillion barrels of
conventional oil using only 30-40% of Oil in place
It will probably still be in balance without any radical changes for the next
30 years, but what happens regionally?
Confidential
4
In the Oil Sector
6
Europe & Eurasia
5
Production: 16200
4
3
Americas
Consumpt:
19400
Balance:
-3,200
Middle East
Africa
Asia-Pacific
Reserves
2
Production
1
0
Production: 20800
Production:
8000
Production: 21000
Production:
8000
Consumpt:
28000
Consumpt:
2500
Consumpt:
Consumpt:
21500
Balance:
-7,200
Balance:
+5,500
4300
Balance: +16,700
2
3
4
Balance:
4
-13,500
5
3 larger than the rest of the
1 base
2 is two times
0
Middle
East
5 world.
1 reserve
4
3
ME will 2
gain even more strength - Remember the 70’s?
1
Confidential
5
5
Lets take a closer look at our Hemisphere
First at Latin America
000 BOD
Production Consumption Balance
Mexico
3600
1800
1800
Venezuela 3000
500
2500
Brazil
1500
1850
-350
Argentina
800
350
450
Colombia
600
200
400
Ecuador
400
150
250
T&T
150
NA
NA
Peru
100
150
-50
Total LA
10,200
6,400
3,800
The net consumption of other Latin American Countries= 1200mbod
Venezuela largest oil contributor to the region
Confidential
6
Now lets add US & Canada Production and
Consumption
Venezuela
USA
Mexico
Brazil
Canada
Ecuador
Argentina
Other
Colombia
T&T
Peru
0
10
20
30
40
50
60
70
80
BBbls
000 BOD
Production Consumption
Balance
USA & Can
10,600
21,600
- 11,000
Total LA
10,200
6,400
3,800
Americas
-7,200
Venezuela holds 52% of the Oil in the region
Confidential
7
Can Venezuela Improve the future Western
Hemisphere supply/demand balance?
R/P Ratio (years)
Venezuela
75
Ecuador
30
Brazil
15
T&T
15
USA
10
Argentina
10
Other
na
Mexico
10
Peru
10
Colombia
10
Canada
10
How
much
more ?
40000
35000
30000
25000
20000
15000
10000
5000
0
2002
2020
New Venezuela Heavy Oil
Venezuela
Production (Ex- Venezuela)
Americas Demand
Venezuela seems to be the cornerstone for any oil supply dependency
improvements in the region given a 75 year R/P ratio
Confidential
8
Now, In the Gas Sector
193
1963
R/P: 80YRS
R/P: 20YRS
253
R/P: 9YRS
418
R/P: 42YRS
445
R/P: 68YRS
250
1979
R/P: 9OYRS
R/P: 240YRS
NA
S. Central America
ME
Europe
Eurasia
Africa
AsiaPacific
Latin America is in prime location to supply a gas hungry U.S market
Confidential
9
There are 362 TCF of natural gas searching
monetization
POTENTIAL NET
EXPORTERS
ATLANTIC BASIN:
Venezuela
Trinidad
Colombia
Brazil - ?
PACIFIC BASIN:
Peru
Bolivia
Reserves (Tcf)
Venezuela
Bolivia
Argentina
Mexico
Trinidad
Brazil
Peru
Colombia
TOTAL
1P 2P
148 176
24 52
27 38
9 32
23 28
8 12+
9 11
4
5
252 362
Mexico
Venezuela
Trinidad
Colombia
Peru
R/P average of 100 Yr (2P
basis)
200
Bolivia
R/P Ratio (2P)
120
Brazil
Argentina
40
Brazil
Venezuela
80
Peru
Bolivia
160
Mexico
Trinidad
Colombia
0
Venezuela is in first place with 176 TCF of gas and with a Argentina
large potential for
new reserves offshore
Confidential
10
U.S needs in average 20 LNG trains of 4.7
mtpa to fulfill its local supply/demand gap
100
Supply/Demand Gap
95
High Case
2010
9 BCFD
2020
25 BCFD
90
Low Case
3
BCFD
8 BCFD
85
80
75
70
65
2000
2005
SUPPLY RANGE
2010
2015
2020
DEMAND RANGE
Latin America could easily provide 50% of those trains – Venezuela by
itself can provide 20% of the average gap
Confidential
11
Conclusions
 Western Hemisphere oil and gas supply/demand is highly
unbalanced
 Latin America surplus of Oil and Gas resources could potentially
contribute to the security of oil and gas supply
 Venezuela plays the critical role. Its large oil and gas resource
base will help maintain a healthier and diversified portfolio of
supply:
 It Needs support of a Western Hemisphere energy policy
that is efficient and effective
 And business thinking should drive decision making.
 The execution of a strategy to promote and develop important
energy projects will require “Strategic Partnership”, “Timely
Development” and “Efficient Capital Investment and Operational
Cost”
ChevronTexaco is committed to the region with an emphasis in Venezuela
Confidential
12
Here are two examples of our commitment
Mercado en EEUU
HAMACA PROJECT
2010
Regas – Henry Hub
Caracas
Chaguaramas
ChevronTexaco 30%
ConocoPhillips 40%
PDVSA
30%
Upgrader @
Jose Industrial Site
Puerto
La Cruz
PORT OF SPAIN
PLATAFORMA
DELTANA
Península de Paria
10 30' N
Golfo de Paria
Bloque Este del Golfo de
Paria
ConocoPhillips
ENI
OPIC
Ineparia
Bloque Oeste del Golfo de Paria
20”
Diluent
Returen
Return Line
Operating Agent:
Petrolera Ameriven
42”
Pipeline
ConocoPhillips 32.5%
Agip 26%
Opic 6.5%
PDVSA 35%
Delfin-1 x
Esmeralda-1
Campo Corocoro
ConocoPhillips
San Fernando
POSA
ALNG
GPA-01X
“Punta Sur“
TD 13,760'
Corocoro-1,2,3,4,5
10 00' N
10 00' N
Pedernales
Bloque 6(d)
Bloque 2
16”
Pipeline
Drilling
Central Processing
Facilities
Loran-1x
Gasoducto
Batching
Facilities
Caracas
Bloque 4
Puerto
La Cruz
Plataforma Deltana
Venezuela
09 30' N
Bloque 3
30” Pipeline
Hamaca
a
Reservoirs
Orinoco River
Delta del Orinoco
62 00' W
61 30' W
61 00' W
60 30' W
60 00'' W
59 30' W
Two Integrated projects in oil and gas in Venezuela with investment levels of
$5 and $2.5 billion
Confidential
13
Additional Information
© ChevronTexaco 2004
Confidential
In Gas
We will double our production by 2010 and still in search of new
opportunities
1000
Trinidad
Venezuela
MMCFD
800
PD
Venezuela
Argentina
Trinidad
Colombia
600
400
Colombia
200
Brazil
0
2000 2001
2002
2010
Argentina
Headquarters
Venezuela contributes with 50% of that growth
Confidential
Gas Production
Gas Exploration
15