Proposed Venezuela-Colombia Pipeline Needs $8 Billion Investment - PdVSA

A proposed 600,000 barrel a day oil pipeline that would run between Venezuela and Colombia would require $8 billion in investment, state oil company Petroleos de Venezuela, or PdVSA, said thursday in a statement.

The pipeline would give hydrocarbons-rich Venezuela access to Colombia's Pacific coast and allow for quicker transport of crude to Asian markets, a key strategic goal of President Hugo Chavez, who has fortified economic ties with resource-hungry China in recent years.

Venezuela is looking to send more of its crude from its vast Orinoco heavy oil belt, located in the southeastern part of the country, to Asian economies, PdVSA said in the statement, highlighting agreements between Venezuela and Colombia after a meeting of top government officials held the previous day.

Both parties are also open to financing and partnerships from third parties for the pipeline, the PdVSA statement said, citing comments from Colombian Energy Minister Mauricio Cardenas.

"We see with great interest, the intention of the government and authorities from the People's Republic of China to be a part of this initiative," Cardenas was quoted as saying.

PdVSA said that Cardenas and his Venezuelan counterpart, Oil Minister Rafael Ramirez, agreed on a timetable for the project and plan to lay out a conceptual engineering plan by December.

PdVSA sent an average of 639,000 barrels of oil a day to Asia last year, according to the company's annual report submitted to the Venezuelan National Assembly. 

A vast majority of those shipments were directed to China, which currently receives around 460,000 barrels of oil daily, much of it as payment for billions in loan-for-oil accords signed between the two nations.

Chavez has said he wants to increase shipments to China to 1 million barrels a day by 2.015.

Colombian officials also announced on Wednesday that the country's largest company, state-controlled energy firm Ecopetrol SA (EC, ECOPETROL.BO), plans to work with PdVSA to revitalize already developed oil fields in western Venezuela's Lake Maracaibo.