Completed Development AidData Chinese Aid

China Eximbank provides loan for Phase 1 of Sinovensa Orimulsion Production Facility Project (Linked to Record ID#38053)

$252M USD

Funder	Export-Import Bank of China (China Eximbank)
Recipient Organization	CNPC International Limited
Country	Venezuela
Start Date	Dec 27, 2001
End Date	Aug 21, 2033
Duration	11,560 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`102810`

Grant Description

China Eximbank provides loan for Phase 1 of Sinovensa Orimulsion Production Facility Project In April 2001, a cooperation agreement for Orimulsión® was signed by Bitumenes Orinoco, S.A. (BITOR) and China National Oil and Gas Exploration and Development Corporation (CNODC), a subsidiary of China National Petroleum Corporation (CNPC).

The objective of the agreement was to carry out a series of pre-investments necessary to determine definitively the feasibility of Phase 1 of the Sinovensa Orimulsion Production Facility Project.

Then, on December 13, 2001, the National Assembly of the Bolivarian Republic of Venezuela authorized BITOR to establish with CNODC a joint venture called Orifuels Sinoven, S.A. (SINOVENSA).

On December 27, 2001, BITOR, CNODC and PetroChina Fuel Oil Company Limited signed a joint venture (association) agreement, establishing SINOVENSA as a legal entity.

China Eximbank subsequently issued an overseas investment loan (境外投资项目案例) to CNPC International Ltd. (CNPCI) for Phase 1 of the Sinovensa Orimulsion Production Facility Project.

CNPCI, in turn, on-lent the funds from the overseas investment loan to Orifuels Sinoven, S.A. (SINOVENSA)— a special purpose vehicle and joint venture between Bitumenes Orinoco, S.A. (30% ownership stake), China National Oil and Gas Exploration and Development Corporation (40% ownership stake), and Petrochina Fuel Oil Company Limited (30% ownership stake).

📋 Loan / Grant Terms

💰 Loan Amountare unknown

However, it is known that CNODC served as the loan guarantor.

The purpose of Phase 1, which had an estimated total cost of $360 million, was to construct and operate a bitumen emulsification module to produce Orimulsión® (MPE-3).

Another objective was the extraction, exploitation, transportation and industrialization of natural bitumen and associated fluids and the trading of Orimulsión® produced in the installation.

The bitumen emulsification module was expected to have an effective production capability of 125 MBD of Orimulsión® (7.25 million of annual metric tons), which would be exported to the electricity generation industry in China.

The field and the production facilities were to be located in Cerro Negro and Morichal, southern Monagas State, and the emulsification plant at the industrial complex Complejo Industrial de Jose, Anzoátegui State.

As of December 31, 2005, the construction of the facilities at Morichal and the industrial complex Complejo Industrial de Jose reached 82% and 93% completion rates, respectively, and they are expected to be completed during 2006. The SINOVENSA complex was completed in April 2006. However, on December 31, 2006, SINOVENSA suspended the production of Orimulsion® in its complex.

📋 Staff Comments

The Chinese project title is 委内瑞拉奥里乳化油项目.
Bitumenes Orinoco, S.A. (BITOR) is a wholly-owned subsidiary of PDVSA.
The face value of the China Eximbank overseas investment loan is unknown. However, given that the total cost of the investment was $360 million and most Chinese Eximbank M&A (overseas investment) loans cover at least 70% of the total cost of the investment, AidData assumes for the time being that the face value of the China Eximbank loan was roughly equivalent to $252 million. This issue warrants further investigation. See slide 13 of https://www.dropbox.com/scl/fi/l59pewju61dhll79k8msy/2.EXIM-Bank.pptx?rlkey=4ffouewoknm33jnz3dykii2i4&dl=0 for more information on the standard terms and conditions that govern M&A (overseas investment) loans from China Eximbank.
CNPC International Ltd. (CNPCI) is legally incorporated in the Cayman Islands. CNODC and PetroChina Fuel Oil Company Limited are subsidiaries of CNPC5. BITOR is a wholly-owned subsidiary of PDVSA.
On June 3, 2013, China Development Bank (CDB) signed a $4.015 billion loan facility agreement with Petrolera Sinovensa, S.A. (Petrosinovensa or Sinovensa) — a special purpose vehicle and a joint venture of CVP (60% ownership stake) and CNPC Venezuela B.V. (40% ownership stake) — for the Sinovensa Oil Field Development Project (as captured via Project ID#38053).
The loan commitment date is unknown. For the time being, AidData assumes that the loan was issued at the time that the project company (SINOVENSA) was established. This issue warrants further investigation.
One official source (https://www1.hkexnews.hk/listedco/listconews/sehk/2005/0922/ltn20050922091.pdf) identifies China Petroleum Finance Company Limited as a lender that supported Phase 1 of the Sinovensa Orimulsion Production Facility Project. This issue warrants further investigation.
中国对外投资项目案例分析———中国进出口银行海外投资项目精选 is a particularly valuable source of information about this transaction (http://www.wenqujingdian.com/Public/editor/attached/file/20180725/20180725161843_43840.pdf)10. The China Eximbank overseas investment loan that supported this project is referenced by the lender in the following publication: https://www.dropbox.com/scl/fi/uo3wa3ubiju615vrukovf/2014-Overview-of-China-Eximbank-Activities.pptx?rlkey=hj74t3lmt763qtv6fu3132yo0&dl=0

📚 Sources & References

PetroChina's emulsified oil project in Venezuela was put into production
中委公司乳化油项目一期工程建成投产
PETRÓLEOS DE VENEZUELA
S.A.
WORKS IN ORIMULSION PLANT
Petróleos de Venezuela
S.A. Guarantee
Winning Trust with Technology
PETRÓLEOS DE VENEZUELA
S.A. Security and Exchange Commision
PETROCHINA ONGOING CONNECTED TRANSACTIONS AND PROPOSED RE-ELECTION AND APPOINTMENT OF THE DIRECTORS AND SUPERVISOR
报道一《中咨公司莅湛评估奥里油发电厂项目》
中国石油在拉美 Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.

All Grantees

CNPC International Limited

Interested in applying for this grant?

Complete our application form to express your interest and we'll guide you through the process.

Apply for This Grant