CNPC to bid for 2 oil blocks in Venezuela

Jul. 7, 2009 (China Knowledge) - China National Petroleum Corp (CNPC), the country's largest integrated oil and gas enterprise, and France's Total SA intend to bid for two large oil blocks in Venezuela, said people involved in the bidding, Dow Jones Newswires reported.

The blocks being auctioned are located in the Carabobo region of the Venezuela's Orinoco oil belt, which has a total of 272 billion barrels of recoverable reserves.

The sources said the development of one of the two blocks and the building of a processing unit could cost more than US$$10 billion.

Venezuela's Oil Minister, Rafael Ramirez, has said that sealed bids must be submitted by Jul. 28 and that the results will be released on Aug. 14, according to the report.

State-owned Petroleos de Venezuela SA will hold a stake of at least 60% in the blocks. Bidders must pay Venezuela's government an upfront bonus based on their estimated future output and must also explain their oil distribution plan.

In late June, CNPC and U.K.-based BP Plc won the bid to develop the Rumaila oil field, the largest oil field in Iraq, according to an earlier report from China Knowledge.