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Blackouts surge across strife-torn Venezuela

04 May 2017 22:44 (+01:00 GMT)
Blackouts surge across strife-torn Venezuela

Caracas, 4 May (Argus) — Extensive blackouts have spiked in Venezuela since persistent anti-government protests erupted a month ago, adding to a climate of economic paralysis in the Opec country.

Major blackouts occurred this week in nine eastern and western states, including Anzoategui, Apure, Barinas, Carabobo, Miranda, Merida, Nueva Esparta, Tachira and Trujillo. State-owned utility Corpoelec defines a major blackout as an outage of at least 100MW lasting two hours.

State-owned oil company PdV's core upstream and downstream operations have not been disrupted by the blackouts, the energy ministry said.

That view is routinely contradicted by senior labor union officials based at the firm's frequently impaired refineries.

Electricity minister Luis Motta Dominguez tells Argus that "saboteurs with internal accomplices" are responsible for the uptick in power outages since the start of April.

Corpoelec's national power grid "has been the target of many attacks to disrupt power supply and stir up discontent, chaos and unrest," Motta said. The Sebin national intelligence service has created a special unit to root out "saboteurs and conspirators inside Corpoelec."

A senior Corpoelec executive tells Argus that the government ordered the company in early April to suspend all maintenance in areas where protests have persisted despite a lethal crackdown by security forces.

"Motta told Corpoelec management that the measure is meant to protect Corpoelec workers and property, but the reality is the outages are happening in areas where anti-government protesters are most active," the executive said. "It is a punitive measure imposed by Maduro."

The executive, who works in the company's thermal generation division, says PdV bears "much responsibility" for the recent surge in blackouts because it has delayed diesel imports needed to operate thermoelectric units that were originally designed to run on natural gas "that PdV is also incapable of delivering."

"We're currently not getting sufficient diesel supplies for our thermal generation needs, even with 70pc of the thermal fleet out of service," the Corpoelec executive said.

The utility claims it has 15GW of installed thermal generation capacity, mostly in central and northwestern Venezuela. An internal Corpoelec report dated 30 March indicates that two thirds of that capacity, or 10.35GW, is currently off line.

PdV has assured Corpoelec that diesel supply disruptions will be resolved this month as it takes delivery of up to 4mn bl of imported light crude and refined products, including distillates, the Corpoelec executive said.

PdV confirmed it will offload at its local terminals this month a combined 4mn bl of gasoline blend stock, diesel, vacuum gasoil, catalytic naphtha and cutter stock, but declined to give a breakdown by volume. "Some" of the imported diesel is earmarked for Corpoelec, a PdV official said.

The Corpoelec executive also blames the rising blackouts since end-March on "the old chronic problems of defective maintenance, and no foreign currency to pay for equipment and parts imports."

Corpoelec currently has about 16GW of operational power generation capacity including its thermal and hydropower assets. National power demand this year has fluctuated in a range of 13.5GW to 15GW, the 30 March report shows.

Venezuela's economic crisis has depressed power consumption, reducing the strain on Corpoelec's grid. "But the grid's structural deterioration, and the accompanying danger of blackouts that could disrupt PdV's operations, are greater today than they were at the worst of the drought-induced power supply crisis of 2015-16," the executive said.

A severe drought induced by the El Niño weather phenomenon exacerbated Venezuela´s structural power shortages. In 2015-16, blackouts shut down crude processing at the 940,000 b/d CRP refining complex on three separate occasions, forced emergency shutdowns twice at the 140,000 b/d El Palito refinery, and partially shut down the 190,000 b/d Puerto La Cruz refinery.

Corpoelec rationed power for up to six hours daily nationwide for over 26 consecutive months in 2014-16, but relaxed the restrictions in first half-2016 when rainfall replenished the strategic Guri dam. But Corpoelec's grid continues to deteriorate this year from lack of maintenance.