Falling Short Of Production Goals
BMI View: Venezuelan oil production will fall considerably short of the government ' s 2012 year-end production target of 3.5mn barrels per day (b/d). Indeed, we forecast t hat total oil production will average 2.86 mn b/d this year, representing a 16% increase year-on-year from 2011, but still well below publicly stated goals.
BMI 's forecast for average daily production in 2012 is considerably below Venezuela's goal of 3.5mn barrels per day ( b/d ) by year-end, as well as the current production level cited by the country ' s oil minister . According to minister Rafael Ramirez, average output has ranged between 3mn and 3.1mn b/d. However, because the country stopped publishing independently certified data in March 2011, true clarity into the country's production remains elusive. As such, we retain a more caut ious view. Indeed, Venezuela reported to OPEC an average production rate of 2.84mn b/d in August 2012 , which is much closer in line with our own data . A lthough w e forecast strong growth over the coming years, we do not see production exceeding the government's current goal of 3.5mn b/d until 2017.
Venezuela ' s long-term potential is undeniable, with the country ' s proven reserves now estimated to be the largest in the world. As such, despite unfavourable licensing terms and a sour business environment, the country will continue to rely on investment largely from Asian, Indian and Russian players to boost production. Similarly, the country ' s active rig count has reached 373 - a new record, providing further support to a sustained increase in production over time.
|Production To Take Off|
|Venezuela Proven Oil Reserves & Production, 2001-2021 ('000b/d)|