Summary
2 January 2012
Venezuela's Orinoco river delta is set to become a major hub for the oil industry in 2012 as several new projects begin to produce oil for the first time. The area has some of the biggest oil deposits in the world.
Reporter
Sarah Grainger
Venezuela's oil reserves rival Saudi Arabia's
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Report
Venezuela overtook Saudi Arabia in 2011 as the country with the biggest proven oil reserves in the world, according to OPEC. That was thanks to the deposits found in the Orinoco Belt, an area that stretches over 55,000 square kilometres across the delta of the Orinoco River as it meets the Atlantic Ocean.
But much of this oil is extra heavy crude - thick and sticky, it needs special equipment to extract and refine it. Producing heavier crude has met with opposition over its impact on the environment and companies exploring the Orinoco belt have had to look at ways to minimise damage to the surrounding ecosystem.
It all means investment costs are much higher. Companies from Russia, China, Vietnam, the US, Spain and Italy are looking at investing US$ 80 billion over the next six years in partnership with the Venezuelan state oil firm. It's an unprecedented level of investment for Venezuela.
Although the six projects are all due to be pumping oil in 2012, the consortia will not make binding final investment decisions to commit to the projects until 2013.
Sarah Grainger, BBC News, Caracas
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Vocabulary
- overtook
surpassed
- proven oil reserves
confirmed information of the existence of crude oil deposits
- stretches over
spreads or covers a large area
- sticky
substance that tends to fix to any surface it touches
- refine
purify the raw material
- ecosystem
the animals and plants in a particular geographical area and how they interact with each other
- investment costs
money spent in the process of bringing oil to the surface
- unprecedented
that never happened before
- the consortia
several groups of companies joined together
- to commit to
to do something that can't be changed
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