Orimulsion — deepening the debate

Orimulsion — the mix of water, chemicals and tar-like crude that can be burned in power plants — is back in the news, since Venezuelan presidential candidate Henrique Capriles has mentioned its possible revival under his possible administration. (Here’s a story on the topic from El Nacional.)

Caracas Chronicles’ Francisco Toro opined on the topic (also here). Pundit, professor and petrolero Gustavo Coronel weighed in.

One person who has studied this topic more than just about anyone is Juan Carlos Boué. Boué worked for years as an outside consultant to the Chávez administration’s oil ministry in its various names. He writes:

While you were in Venezuela, you must have heard about a business called Orimulsion, which everybody there claimed was the biggest thing since sliced bread. I wrote an immensely detailed forensic report about it, which was published through Le Monde Diplomatique Venezuela, but has had an extremely restricted distribution… If you are daunted by the size and specialised nature of the text, you can skip straight to the appendix, where details on prices and other commercial conditions (previously confidential) are given regarding all the Orimulsion contracts that were signed throughout this product’s mercifully brief life. Surprisingly, the Venezuelan political opposition is talking about resuscitating this Venezuelan invention, which brings to mind that saying about the post-Revolutionary Bourbon kings in France having forgotten nothing and learned nothing.

I am honoured that he sent the book over here for free distribution. And here it is:

Síndrome Orimulsión 2012. Yes, it’s a 470-page, highly technical treatise in Spanish. And yes, if you want to debate this stuff, you should be able to read it.

Regardless of your thoughts and feelings about Orimulsion, this book looks useful. Enjoy. Many thanks to Boué for distributing it here.

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10 thoughts on “Orimulsion — deepening the debate

  1. Gustavo Coronel

    Thank you for the mention of my comments. Although I have lived through the last 55 years of the Orinoco saga, ever since the first publication on the area was presented to the VII World Petroleum Congress in Mexico City, in 1957, I am not an expert in Orimulsion. Our experts in Orimulsion in the old PDVSA were people like Carlos Borregales, who was president of BITOR and his staff of petroleum engineers. I am a geologist. I guess we are to petroleum engineers what cardiologists are to gastroenterologists (neighbors).
    I am already reading the 30 page + foreword of the book, by Boue’s good friend Bernard Mommer, which illustrates the problem with this issue of Orimulsion, namely, an extreme ideological posture. He attacks the development of Orimulsion as treason and those who helped its development as traitors and unpatriotic. Strange, because Mommer is a mercenary who came from abroad and never lived in the insides of the Venezuelan oil industry. He simply sounds more chavista than Maduro.
    The foreword is a very political piece, full of venom. If I have the time I will write a comment on it and send it to you. What appears to be factual about the Faja today is that Chavez does not wash nor does he lends the washing machine, ni lava ni presta la batea. Orimulsion is a strategic, commercial, technical issue, not a religious or ideological one.
    I just published a paper that touches upon this matter in the Journal of Energy Security and can be found in its website.

  2. sapitosetty Post author

    Gustavo – I’m pleased to hear you’re reading the book and responding to it. I hope you can get past what you see as venom and actually get something useful out of the material. One problem in Venezuela these days is that both sides find it easy to dismiss the other as either propagandist or not Venezuelan enough or both. Let’s try and keep it elevated.

  3. Dr. Faustus

    I have a question:

    Are there any other companies outside of Exxon/Mobil and Conoco/Phiipps who have expertise in the engineering and construction of upgraders? And, and, ……are the Venezuelan engineers assigned to the maintenance of said upgraders up-to-task in keeping the confiscated upgraders up and running? If not,….oh boy.

  4. sapitosetty Post author

    On the first one, yes. Chevron, Total and Statoil all have good upgraders in Venezuela, and a bunch of other companies have built upgraders in Canada. As to the second question, Venezuelan engineers are fine. Very little of the crew changed with nationalization. But you’re not asking the right question. PDVSA doesn’t prioritize maintenance, and the upgraders are indeed suffering.

  5. Jose

    Hi, about Dr Faustus’ questions, yes there are several upgraders in Canada, many of them have more years operating that those in Venezuela, other company with Upgraders is Shell…

    About the second question, not completelly agree with Setty when he says that “very little of the crew changed…” I worked in one of those upgraders until 2007 and I would say that at least 80% of the engineers in Maintenance/Technical positions quit our jobs for different reasons; I am not saying that the people working there are not good professionals but Setty is right when he says that maintenance, reliability and most important, safety is not a priority.

      1. ColombiaGringo

        Hmm, I can only speak for one particular upgrader where there was a group of 58, yes fifty eight of us, who were advised that our contracts would be terminated on May 31, 2007, this occurred in April 2007. Perhaps that is not quite the same as being fired and perhaps you are only referring to national employees of the joint ventures. In addition I know many Venezuelan colleagues who moved on due to the new regime and its political requirements. Either way what was lost in the Nationalization (Expats and Nationals) was a tremendous amount of experience and work ethic which along with rapidly dwindling maintenance budgets (PDVSA was now responsible for the lion’s share of maintenance) which has resulted in a poorly maintained and operated upgrader.
        The last couple of responses to your original topic (Orimulsion) digress somewhat but do speak to the politically motivated decisions that have negatively impacted the industry and life in general in Venezuela, including the termination of orimulsion production.

  6. Gringo

    Setty:
    PDVSA doesn’t prioritize maintenance.

    In a phrase, the history of PSDVA under Chavista control, from upgraders to conventional refineries to drilling to ……

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