How long would it take to get Venezuela's oil flowing?

[ronwagn + 6,290]

In an ideal new regime, how long would it take to get Venezuela's oil industry humming? What would it do to the world oil markets? 

[Fred czubba + 15]

Its been a long time since I was there 2001 / 2002,I figure you could get the oil flowing and to the export terminal in Puerto La Cruz in a few months ,,,,however getting things up to snuff ( as per the old PDVSA  safety and health)   would probably a longer time( A few years, as the refineries are a mess). The USA   could easily design a quick Mini Marshall Plan to help ,but I figure the Chinese will beat them to the negotiating table.

 

[Jan van Eck + 7,558]

Your larger obstacle will be to dislodge and replace all of the political appointees inside the management of PVDSA.  The old managers, who knew what they were doing, are all gone - moved off to greener pastures.  What is in there now are the incompetent cronies of Maduro, there for the looting and pillaging of assets.  The missing (stolen) hardware can likely be sourced soon enough.  Getting the right people in charge is going to be a huge job.  You may still be limping along three years from now.  

[Fred czubba + 15]

Yes,agreed , the people problem will be huge,,,those oil and gas professionals that moved off to greener pastures are in the USA or other countries.They have been resettled and most likely will not be keen on returning( if ever) until stability is established and secure. . With  the ousting of Maduro, the new government must address the many social and economic  issues facing them and they need to make the hard decision on who will be their new friends and who they will invite to assist with the rebuilding of a broken industry.  (CNPC would gladly help.)

[wrs + 893]

"Trident does not have the funds to operate its infrastructure or enter into creditor protection. As a result, they have decided to walk away, leaving more than 4,400 licensed sites, many of them active, without an operator," the watchdog told CBC.

https://oilprice.com/Latest-Energy-News/World-News/Canadian-Oil-Driller-Abruptly-Shuts-Down-Abandons-4700-Wells.html

I suspect Venezuela is in the same death throes this company was in about three years ago.  I don't think anyone wants to admit how bad things really are in Venezuela based on the production declines we are seeing which are as bad or worse than shale.  

 

 

Edited May 2, 2019 by wrs

[Frank Wylie + 4]

Yes, agreed on PDVSA's people problem.  With the billions owed the Chinese and Russians, they will likely end up controlling much of the oil patch in the years to come, regardless of who is in charge in Caracas.   It seems the military continues to get paid to some degree, as there is no place for them to go at this point.  It looks like the military is getting some support from the Russian's as they are likely getting paid in what is left of the gold reserves. Chavez started the destruction and Maduro is about to finish it. Guaido will have to deal with the Chinese and Russians in some way I suspect if he ends up taking over.  Then they will have elections at some point, and you can bet the Russians will have a role to play at that point as well. In the meantime, Guaido is looking for money so he can start buying off the military which are also controlling what is left of PDVSA. To answer the question China will do what it takes to get their money back, and it won't take long.

[Manfred Kruger + 40]

Asuming that the politics are resolved properly and competent management and workers take over, the first 500 thousand barrels per day to bring total production to 1.3 to 1.5 million barrels per day should come back within 12 months.

No one knows exactly how much damage was done to production and transport infrastructure due to utter mismanagement, lack of maintenance and corruption. My guess is that previous 3.5 million bpd capacity could be achieved within 5 years and up to double that within 10 years if they open up the industry to foreign investment and allow the private sector to run the industry. If not, it will never recover.

[Wombat + 1,028]

I remember reading about a year ago that production costs in Venezuela about $70/bbl. If prices do not rise, won't their production fall to zero anyway?