Venezuela: Politicaland Economic Update

University of Miami

Center for Hemispheric Policy

October 30, 2007

Coral Gables, FL

Venezuela: Politicaland Economic Update

…first some definitions:

Monetization

Conventional Oil

Unconventional Oil

Venezuela: Politicaland Economic Update

World Largest Oil Reserves

Venezuela 79 / 250 / 329

Saudi Arabia 264 / 0 / 264

Canada 16 / 163 / 179

Iran 137 / 0 / 137

Iraq 115 / 0 / 115

Kuwait 101 / 0 / 101

UAE 98 / 0 / 98

EIA 2006, Billion Barrels, Conventional Proven/ Unconventional Undiscovered/Total Reserves

Venezuela: Politicaland Economic Update

Venezuela’s Crude Oil Production

≈ 3 million barrels per day

PDVSA’s 2012 Crude Oil Production Target

5.8 million barrels per day

EIA/PDVSA 2006

Venezuela: Politicaland Economic Update

Oil Patch Enablers

Geology

Capital

Technology

Know-How

Stewardship

Venezuela: Politicaland Economic Update

Venezuela’s Crude Oil Average Price

2003 $24.82

2004 $32.88

2005 $46.15

2006 $56.45 2007 $60.66 10/19 YTD

PDVSA

Venezuela: Politicaland Economic Update

PDVSA 2006 Income Statement

Revenues: $99 Billion

Royalties: ($18)

Social Programs: ($14)

Corp. Taxes: ($ 4)

Net Income: $5.5 Billion

PDVSA 2006

Venezuela: Politicaland Economic Update

Venezuela: Politicaland Economic Update

PDVSA’s 2012

Opportunity Costs

Crude Oil, Domestic Price Subsidies, Natural Gas, Petrochemicals

$64 billion in Revenues

At Current Prices

2012 Est. Low Case at $60/bll Ven Basket