Japan to Explore Orinoco Oil Deposits in Venezuela

Japan Oil, Gas and Metals National Corp. is expected to sign a memorandum of understanding this summer with Petroleos de Venezuela S.A., Venezuela's state-run oil company, to jointly explore oil deposits near the Orinoco River, according to sources familiar with the matter. The plan by the independent administrative institution is part of Japan's efforts to strengthen its energy security through the diversification of crude oil suppliers, as the country currently depends on the Middle East for 90 percent of its crude oil imports. The Orinoco extra heavy oil deposits, known for their tar-like, highly viscous nature, are nonconventional oil deposits, which include oil sands and oil shale. Although it is much costlier to develop such deposits, recent surges in crude oil prices have provided a tail wind for projects to develop nonconventional oil deposits. Senior officials from Japan's Ministry of Economy, Trade and Industry will visit Venezuela as early as August to hold final negotiations with Petroleos de Venezuela, the sources said.