Exclusive: Venezuela transfers the accounts of oil companies to the Russian bank – document, sources

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PHOTOS PHOTO: Scraps depicting images of oil operations are seen outside a building of the Venezuelan state oil company PDVSA in Caracas, Venezuela, 28 January 2019. REUTERS / Carlos Garcia Rawlins / File Photo

CARACAS (Reuters) – Venezuelan state oil company PDVSA is telling customers of its oil joint ventures to deposit sales proceeds on an account recently opened at Russian Gazprombank AO, according to sources and an internal document seen by Reuters on Saturday.

PDVSA's move follows harsh, new US financial sanctions imposed on January 28 and aimed at blocking access to oil to the left of President Nicolas Maduro to the country's oil revenues. The United States and dozens of other nations have refused to recognize Maduro, calling fraudulent his election last year to another six-year term.

Since then, PDVSA has pressed its foreign partners into joint ventures in its Orinoco Belt production area to formally decide whether to continue in the projects, according to two sources with knowledge of the talks. The joint venture partners include the Norwegian Equinor ASA, the US Chevron Corp and the French Total SA.

PDVSA has also ordered its Petrocedeno joint venture with Equinor and Total to stop the production of extra-heavy oil and to retrain due to the lack of naphtha necessary to dilute production, since the sanctions forbid US suppliers to export it to Venezuela.

"We would like to formalize your knowledge of the new banking instructions to make payments in US dollars or euros," said PDVSA vice president, Fernando De Quintal, in a letter from February 8 to the PDVSA unit that supervises its joint ventures.

Even after a first round of financial sanctions in 2017, the PDVSA joint ventures managed to maintain bank accounts in the United States and Europe to receive the proceeds from oil sales. They also used correspondent banks in the United States and some European countries to transfer money to the PDVSA collection accounts in China.

PDVSA several weeks ago informed customers of the new banking departments and started moving the accounts of its joint ventures, which can export crude oil separately. The decision was taken in tilt with some of its partners, who withdrew the personnel from Caracas since sanctions were imposed.

Reporting by Marianna Parraga in Mexico City and Corina Pons in Caracas; editing by Jonathan Oatis

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