For Venezuela, A Treasure in Oil Sludge

Venezuela has high levels of sludge, called bitumen, once thought of as useless. But now, technology introduced by foreign oil companies such as Chevron Corporation transforms the sludge into oil. The discovery puts the government and oil companies at odds. The government claims that exploration and production in the Orinoco Belt is easy, risk-free and inexpensive and suggests that oil firms exaggerate difficulties and costs of the project. The government also argues that, even with higher taxes and royalties, the corporations can still expect high profits. The oil companies, while not publicly contesting government claims, express frustration about the government’s refusal to acknowledge previous. With the Orinoco Belt potentially the largest oil field in the world, executives of oil firms and other oil-producing countries might grumble, but most will pay attention to demands from the Venezuelan government. – YaleGlobal