---------------------- Forwarded by Scott Neal/HOU/ECT on 06/19/2000 05:05 PM 
---------------------------


Barry Steinhart@ENRON
06/07/2000 02:32 PM
To: Jeffrey A Shankman/HOU/ECT@ECT, Scott Neal/HOU/ECT@ECT
cc:  
Subject: LNG: FRANCE: PDVSA sees Enron LNG deal soon, seeks gas funds.


FYI

---------------------- Forwarded by Barry Steinhart/Corp/Enron on 06/07/2000 
02:30 PM ---------------------------


djcustomclips@djinteractive.com on 06/07/2000 02:55:23 PM
Please respond to nobody@mail1.djnr.com
To: 196816@mailman.enron.com
cc:  

Subject: LNG: FRANCE: PDVSA sees Enron LNG deal soon, seeks gas funds.


FRANCE:
PDVSA sees Enron LNG deal soon, seeks gas funds.

06/07/2000
Reuters English News Service
(C) Reuters Limited 2000.

NICE, France, June 7 (Reuters) - Venezuela's state oil company Petroleos de
Venezuela (PDVSA) said on Wednesday it expected to sign a contract with U.S.
energy company Enron by June 30 to construct an LNG plant in Jose with an
annual capacity of two million tonnes.

It has signed an agreement with Royal Dutch Shell , ExxonMobil and Mitsubishi
to begin construction of a four-million-tonne LNG plant in Paria by end of the
year.
"We could sign the contract to start the project (with Enron) by June 30...The
plant should be operational by 2004," Domingo Marsicobetre, chairman of
PDVSA's gas division, told reporters at the world gas congress in Nice.

"The project development agreement was signed with Shell, Exxon and Mitsubishi
last month. In September we will declare the viability of the project and then
create a (separate) Venezuelan LNG company (to run it). The milestone is
December," Marsicobetre said.

The Paria plant was expected to be operational by 2005, he said, adding that
the consortium hoped to explore further oil and gas in the Orinoco delta
platform, south of Trinidad, to add a second and third train to the plant. "In
August a decision will be taken by the shareholders," he said.

PDVSA would supply associated gas to the Jose plant, in which it would also be
a shareholder. The facility aimed to export mainly to the Caribbean and the
United States, he said.

The Paria plant was designed to export LNG to the north-east United States,
Spain and Portugal.

Marsicobetre said PDVSA Gas was seeking between $6 billion and $10 billion in
private investment to develop the production of non-associated gas, its LNG
projects and the Venezuelan gas grid.

Expanding non-associated gas and the gas grid would each absorb 30 percent of
that total sum while the two LNG facilities would need some $2.6 million. The
cost of developing oil and gas production in the delta platform was not
included in that calculation, PDVSA Gas executive Nelson Mava told reporters.

"If we move in a fast track we can have twice that investment," Mava said.

He said Venezuela, the world's seventh largest gas producer with proven
reserves of 146 trillion cubic feet (tcf), was counting on the development of
non-associated gas to meet rising domestic demand.

Venezuelan gas consumption was forecast to more than double by 2009, rising to
4.2 billion cubic feet a day from the current level of 1.8 billion. That meant
the percentage of gas in the fuel mix would rise to 55 percent from 42, Mava
said.

Of the current 142 tcf output, 132 tcf was associated and 14 non-associated.
But there were unexplored reserves of non-associated gas of 6-20 tcf onshore
and 40-60 offshore, he said.

((Gillian Handyside. Paris newsroom tel +33 1 4221 5343, fax +33 1 4236 1072,
gillian.handyside@reuters.com)).



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