The French oil company "Total" (TotalEnergies SE) andEquinor ASANorway is exiting a major project in Venezuela, in the context of a wave of foreign companies leaving in recent years with the country's energy industry declining.
The two companies transferred stakes in the Petrosedino oil production joint venture to PDVSA, the Venezuelan national oil company, according to two sources with direct knowledge of the decision.
Total and Equinor, which own 30% and 10% respectively, have been major partners with PDVSA since the 1990s. The sources said that Venezuelan government officials are expected to announce the two companies' step to exit a joint oil project at a later time.
Petrosedino's projects include operations in an oil field in the Orinoco heavy oil refinery belt, including a facility that blends commercial grade heavy oil. After the exit step, PDVSA will have 100% stake in the project.
Total was among the four largest international producers of crude oil in Venezuela recently until the mid-2000s, with its production ranked second among global companies in 2007, according to the statistics of the Venezuelan National Oil Company.
After the late President Hugo Chavez confiscated oil companies and changed contracts in the early 2000s, Total was one of the few foreign companies that continued operations in the country.
Even after the United States imposed sanctions on the Venezuelan oil industry, the Petrosedino project continued to be one of the largest producing oil fields in the country, although total production declined to levels last recorded in the 1940s.
After the decline in refinery production in Venezuela, which caused fuel shortages, PDVSA decided this year to integrate some Petrosedino stations into its refineries, with the aim of helping boost gasoline production.
The sources said that Total and Equinor were not part of the decisions that led to this integration, while Total's representatives in Venezuela, Equinor and BDVSA declined to comment.