Skip to footer

What will Venezuela do with its oil? Top five energy challenges after Chàvez.

With the passing of Hugo Chávez, the issue of what Venezuela chooses to do with its oil moves to center stage for the energy industry – and for environmentalists. Venezuela’s future leaders face key questions, including who to sell to and barter with and how aggressively to develop the country’s huge tar sands (oil sands) deposits. Here are five energy challenges that Venezuela will have to grapple with, many of which will have repercussions beyond its borders.

1. The Orinoco Belt

Miraflores Palace/Handout/Reuters/File
Venezuela's late President Hugo Chavez takes a sample of crude during his weekly broadcast at a nationalized oil field at Orinoco's belt in the southern strip of the eastern Orinoco River in 2008. One of the biggest dilemmas facing Venezuela's post-Chavez leaders is what to do with the country's immense deposits of tar sands, which offer a huge possible source of oil that would be costly and difficult to extract.

The biggest issue for Venezuela is what to do with its immense deposits of tar sands (also known as oil sands). If one counts the technically recoverable oil estimated to lie in a 375-mile stretch of land along the Orinoco River, then Venezuela has bigger oil reserves than anybody, including Saudi Arabia – some 296.5 billion barrels of oil, by one estimate. The big question: Is it economically feasible to produce that oil? The process is energy intensive, costly, and environmentally questionable. Environmentalists have attacked Canada for producing oil from its tar sands – and have mounted a highly visible campaign to stop a planned pipeline that would carry its oil product to US refiners in the Gulf of Mexico. Venezuela's effort could turn out to be even bigger.

Venezuela needs to do something. Under Mr. Chávez, its economy became even more reliant on the oil industry even as production fell. In the mid-1990s, Venezuelan production peaked at around 3.5 million barrels of oil a day. Today, it's closer to 2.5 million barrels a day.

In the 1990s, Venezuela created four projects to begin to convert its tar sands into a lighter crude, known as syncrude. The facilities have the capacity to produce 600,000 barrels per day, according to the US Energy Information Administration, but they are estimated to be producing less than 500,000 a day. Venezuela could use more investment to develop its tar sands, but that would require outside help.

1 of 5
Mark Sappenfield
Editor

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

Subscribe to insightful journalism

You've read  of  free articles. Subscribe to continue.