CARACAS, (AFP) — Venezuela says it has dethroned fellow OPEC member Saudi Arabia to become the nation with the largest proven crude oil reserves in the world, at nearly 300 billion barrels.
“At the end of 2010, we had a level of 217 billion barrels of oil, and right now at the start of this year, we can certify 297 billion barrels,” Oil Minister Rafael Ramirez said Wednesday.
Saudi Arabia, long the world’s top producer and exporter of crude, has some 266 billion barrels of oil, according to the Organization of the Petroleum Exporting Countries.
Venezuela, Latin America’s leading exporter of crude, has claimed steadily growing proven oil reserves in recent years, including a 23 percent increase one year ago due primarily to oil certifications in its vast Orinoco Belt.
A jubilant President Hugo Chavez, at the helm of the socialist country that nationalized most of its energy industry in 2007, hailed the new figures, saying they ensure the country’s long-term energy sustainability.
“With these reserves to date, and the pace of our operations, Venezuela has enough oil for 200 years. No country on this planet has oil for 200 years,” Chavez said.
Venezuela produces about three million barrels of crude per day, according to official government figures, although just 2.3 million barrels are committed to OPEC. It was the world’s eighth biggest oil producer in 2009, according to the International Energy Agency.
The country’s new reserves total was provided by Petroleos de Venezuela, the state-owned giant that since 2007 has taken at least a 60 percent share in all oil projects in the country.
Estimates in the Orinoco Belt are huge, with Venezuela boasting that it could be the largest single oil field on Earth.
Ramirez said that the total reserves included, 220 billion barrels of oil in the Orinoco Belt, “which serves as a resource base and a solid foundation for all our expansion plans.”
The region, some 55,314 square kilometers (21,360 square miles) in eastern Venezuela’s Orinoco River area, has seen a boon in domestic and foreign investment in recent years as Caracas seeks to exploit the Orinoco Belt’s reserves of heavy and extra-heavy oil.
The US Geological Survey last year estimated there were 513 billion barrels of “technically recoverable heavy oil” in the region, although for years experts believed it was prohibitively expensive to extract and refine the heavy and extra-heavy oil in the area.
But steadily depleted light crude reserves, and an increase in global oil prices — currently around 100 dollars a barrel, against 20 dollars a barrel in the 1990s — have revived interest among foreign firms that have pledged tens of billions of dollars in investment.
Last year, some 30 companies from more than 20 different countries were operating in the Orinoco Belt.
Orinoco oil has been a point of contention in the petroleum world, and Chavez’s hands-on approach to the oil industry has alarmed some investors.
The reserves are also years away from development, so the Caracas announcements “don’t have an immediate impact on the oil market,” said oil expert Andy Lipow of Lipow Oil Associates, based in Houston, Texas.
“In Venezuela, many of their reserves are very heavy, viscous crude and it takes a huge amount of investment in order to get that out of the ground.”
Last July, Prince Turki al-Faisal, a former Saudi intelligence chief, dismissed claims by Chavez that Venezuela might have more than Saudi Arabia’s proven reserves.
“These claims are entirely about unproven reserves, so they are completely hypothetical and, in my opinion, entirely unfounded,” the prince said at the time.
“Were Saudi Arabia to go down the path of claiming unproven reserves, there would still be no competition,” he added, saying the desert kingdom might have over 700 billion barrels underground.
Saudi oil reserves, although aging, are for the most part easily recoverable light crude. Extracting oil from difficult production areas such as the Orinoco Belt requires far more complicated and costly equipment and procedures.