Venezuela Oil Pipeline Blast : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread

07/10 09:14 Venezuela Oil Pipeline Blast Forces Rerouting of 90,000 Bbl/Day By Joshua Schneyer

Caracas, July 10 (Bloomberg) -- An explosion at Petroleos de Venezuela SA pipeline that's used to transport 100,000 barrels of crude a day forced the company to reroute most of the oil, though the flow was cut by about 10 percent.

Saturday's blast, which local news media said appeared to be an accident, forced PDVSA to evacuated thousands of people from Ciudad Ojeda, where flames raged through a residential neighborhood of the town near Lake Maracaibo.

The 30-inch diameter pipeline in oil-rich Zulia State leading to the Puerto Miranda export port remained shut, and the company said it should be repaired in five days. PDVSA, one of the top oil suppliers to the U.S., didn't say whether oil exports were affected.

``Transport of oil through the pipeline was stopped once the problem was detected, and PDVSA applied alternatives to transport the crude,'' the company said in a statement. The cause of the blast is under investigation, the company said.

The explosion, which leaked some 2,000 barrels of light grade crude into the area surrounding the pipeline, is the second major blast to hit PDVSA pipelines in the last week, after a major explosion of a pipeline at its Jose complex on Thursday.

PDVSA said some homes in the area of Saturday's explosion were destroyed, although nobody was killed. The company said residents of the area had built their homes too close to the pipeline, although the company said it would cover the cost of all material losses.

Venezuela, the largest oil exporter in Latin America, ships about two thirds of its production of nearly 3 million barrels a day of oil to U.S. markets.

Last week's blast at the Jose pipeline affected operations at a $2 billion heavy crude project including Exxon Mobil Corp., Veba Oel and PDVSA. PDVSA has come under fire in the last year for putting off some maintenance on its pipelines and refineries.

-- Martin Thompson (, July 10, 2000

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