The European Union has agreed to allow Venezuela’s state-owned oil company, Petróleos de Venezuela SA, to purchase up to 1.2 billion barrels of oil a day for the first time in two decades.
Gasolina, a unit of Venezuela’s energy giant Petróledneos de Petrobras, said it would take about a year to begin storing its reserves and would continue to drill new wells.
Petrobras said on Friday it would start a project to pump about 10 billion cubic feet (bcm) of gas from its gas storage tanks in an effort to boost production.
But in an interview with the Spanish newspaper El Mundo published on Saturday, Petréledneo president Carlos Salas called the agreement “unacceptable.”
“I don’t know what they will say about us, what we will do,” Salas said.
“We have already started drilling for natural gas in our gas storage area, we have already drilled one well and we have another in the pipeline.”
Petrocarbons’ bid to buy gas from Venezuela’s government comes after the government of Venezuelan President Nicolas Maduro said it planned to allow the firm to take over the gas storage.
Venezuela’s opposition has called the deal a coup.
The oil giant said on Thursday it would purchase about 10 bcm of gas for the storage tanks, a move that will help ease tensions in Venezuela’s oil-producing country.
Venezuela had been exporting about 4.5 bcm to Europe every day.
In an interview published on Friday with El Mundó, Salas defended the deal as a sign of the government’s commitment to lifting oil prices and said he hoped to make the sale official next month.
“We are working on the first purchase and the next purchase in three months,” Salvas said.
Salas said he had been in talks with Venezuela’s foreign minister about the deal.
“They have agreed to sell, and we will send it to the government,” he said.
“This is the most important thing that we are doing, and I will announce it as soon as possible.”
The deal is expected to bring in around $1 billion a year for the company, the largest oil company in Venezuela, and it will also help diversify Venezuela’s economy and create thousands of new jobs, the oil giant’s head of oil sales, Carlos Dominguez, said in the interview.
“It will enable us to develop and diversify our product line,” Domingues said.