Venezuelan President Hugo Chavez is battling a lung infection after cancer surgery. Friends and foes of President Chavez are concerned for the future of Venezuela. The President has been in power since 1999, and was recently reelected for a fourth term. The people of Venezuela may have to face the reality that President Chavez is not fit to serve a fourth term. The enormous personality of President Chavez is unlikely to be matched by any successor. Unfortunately, this may create a power vacuum that will test the will of the people to support the Constitution of Venezuela.
Venezuela is no ordinary country in the eyes of world leaders. Venezuela contains the biggest oil reserves in the world, making the country a prize to all oil interests around the world. There is no question that many of these oil interests would like to see a friendly face as president in Venezuela. To put it simply, President Chavez reneged on many oil contracts with international oil companies, and some of those companies left Venezuela.
The Orinco Oil Belt in east central Venezuela is the prize. It stretches horizontally about 21,000 square miles along the northern bank of the Orinco River. The US Geological Survey estimates the region contains a massive 513 billion barrels of recoverable heavy oil, which makes Venezuela the largest holder of oil reserves in the world. In fact, Venezuela’s reserves dwarf the often disputed reserves of 265 billion barrels in Saudi Arabia. However, the Orinco oil is expensive to extract. State oil companies and international oil companies have already extracted most of the easy cheap oil. Much of the future oil supply is coming from very expensive unconventional sources.
Chevron negotiated with the Venezuelan government and remained to produce oil and gas in Venezuela. This is a world oil outlook from the Chevron website: “The world has produced about 1 trillion barrels of crude oil to date. Over the next century or so, approximately 2 trillion barrels more are expected to be produced from conventional proved reserves and undiscovered conventional oil. Additional supplies will be produced by Chevron and others from unconventional oil resources, such as extra-heavy oil in Venezuela, oil sands in Alberta and shale oil in the United States.”