Caracas backs Russian oil work

Feb. 9, 2012 at 7:27 AM

CARACAS, Venezuela, Feb. 9 (UPI) -- The Venezuelan government gave the go-ahead for the development of the Orinoco oil belt through a joint venture between Russia and a state oil company.

A subsidiary of Gazprom in Latin America takes a 40 percent stake in a program with a division of Venezuela's state-owned Petroleos de Venezuela, known by its initials PDVSA.

The venture will work on 21,236 square miles in the Orinoco oil belt, Venezuelan newspaper El Universal reports.

Russian state-run oil company Rosneft last year signed a memorandum of understanding to help develop Orinoco, one of the biggest oil fields off Venezuela's coast.

The Venezuelan government in 2007 ordered international oil companies to transform production agreements into ones that made them minority shareholders with PDVSA in the Orinoco belt. The government is locked in a court battle with Exxon Mobil over that decision.

Venezuela has some of the largest deposits of crude oil. The Orinoco belt is considered one of the biggest reserve fields outside of the Middle East and Venezuela.

Moscow in 2010 paid more than half of the $1 billion for work in the Junin-6 block in the oil belt.

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