On May 23, an agreement to create a joint venture to develop heavy oil reserves in Venezuela in the framework of the Carabobo-2 project was signed in Barcelona, Venezuela, by Rosneft and the Venezuelan Corporacion Venezolana del Petroleo (CVP), a subsidiary of PDVSA.

The agreement was signed by Rosneft President and Chairman of the Management Board Igor Sechin and Venezuelan Oil Minister and PDVSA president Rafael Ramirez in the presence of the Venezuelan president Nicolas Maduro.

The enterprise's creation was approved by the National Assembly of Venezuela, the President's decree and a resolution by the ministry of oil and mining industry.

Rosneft's stake in the joint venture will amount to 40%, the other 60% will be held by CVP. The Carabobo-2 project includes blocks Carabobo-2 North and Carabobo-4 West with a total area of 342 square kilometers located in the Orinoko river's heavy crude belt. Reserves at the blocks are estimated at 40 billion barrels (6.5 billion tonnes). Commercial oil production is expected to peak at over 400 thousand barrels per day (about 25 million tonnes per year).

According to the memorandum, Rosneft is to pay a bonus of $1.1 billion for entering the project in two tranches (40% and 60%) and also to offer a loan of $1.5 billion to Corporacion Venezolana del Petroleo with the maximum yearly take-off of $0.3 billion.

The joint venture plans to perform the entire cycle of site exploration and development, building ground facilities and field pipelines. There are also plans for building a special refinery (upgrader) to increase the quality of the extracted oil to commercial.

Rosneft’ President said before that the new joint venture would be named Petrovictoria. The companies actively work on other new projects including the Venezuelan shelf, he also added.

The companies have also signed a confidentiality agreement allowing Rosneft to obtain geological data on Venezuelan offshore blocks for possible future cooperation.

Earlier Rosneft and the Venezuelan company had signed a memorandum of intent to study several gas sites on this country’s shelf.