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PdV ships petroleum coke to Cuba

Source: Pixabay, November 28, 2019

Venezuela's state-owned PdV is shipping petroleum coke to Cuba to reduce stockpiles of the oil byproduct at the 940,000 b/d CRP refining complex in Falcon state, according to multiple company officials.

The Malta-flagged bulk carrier Lagonda departed from the 305,000 b/d Cardon refinery's terminal on 24 November bound for Cienfuegos in Cuba carrying 26,000 metric tons of coke, the officials said.

A bill of lading dated 23 November seen by Argus values the shipment at $1.7mn with Cienfuegos as the final destination. The buyer is listed as Cuba's state-owned oil company Cupet.

PdV officials at the CRP complex said the cargo officially earmarked for delivery at Cienfuegos is intended to circumvent US sanctions against Venezuela and likely will be re-exported from Cuba either to Portugal, Italy, Spain or Turkey where PdV has shipped coke in previous years.

PdV plans to continue shipping coke to Cuba, the officials said. But it is unclear if these shipments will generate any cash revenue for PdV.

The coke shipment comes on the heels of a wave of PdV oil shipments to the island in October and early November, a move that enabled PdV to clear out a backlog of crude that the company was unable to market largely because of US sanctions.

PdV's shipments to Cuba are invoiced under longstanding bilateral agreements in place since 2000 between Caracas and Havana that mandate delivery of Venezuelan crude oil and oil products as payment for the deployment of Cuban advisers in a range of areas, including security.

In recent months, the US government has expanded its Venezuela sanctions onto Cuba, which is already the target of US economic sanctions for nearly six decades.

PdV has been trying for several years to reduce stocks of up to 15mn tons of coke accumulated mainly at its Jose oil processing and terminal complex in Anzoategui state. Smaller volumes of coke are also stockpiled at the CRP complex, the officials said.

At least three contracts signed since 2016 with operators in Italy and Turkey to refurbish coke handling systems and reduce stocks have made little if any progress, oil ministry and PdV officials acknowledge.

Coke, a byproduct of upgrading tar-like Orinoco oil into lighter crude, has accumulated quickly at Jose since a 2009 fire temporarily halted exports. Mammoth coke dunes at Jose have drawn criticism from environmentalists and nearby communities.

The CRP, which includes the Cardon refinery and nearby 635,000 b/d Amuay refinery, currently is operating at about 11pc of its nameplate capacity, the officials added.

News Source: Argus Media