OREANDA-NEWS. Venezuela will stop importing natural gas from Colombia at the end of the month in anticipation of the start-up of its first offshore gas production, state-owned PdV said late yesterday.

The Venezuelan company said an existing supply agreement with Colombian state-controlled Ecopetrol and Chevron that expires on 30 June will not be renewed.

Venezuela?s offshore gas production will come from the Perla field in the Gulf of Venezuela.

The \$5bn Perla project is part of the Cardon 4 joint venture, in which Spain?s Repsol and Italy?s Eni hold 32.5pc apiece. PdV holds the remaining 35pc.

Perla will start producing up to 150mn ft3/d (4.2mn m3/d) of gas and 3,600 b/d of condensates around the end of June, rising to 450mn ft?/d of gas and 10,600 b/d of condensates by the end of the year, PdV officials have said. Production will ramp up to a peak of 1.2bn ft3/d of gas and 28,000 b/d of condensates in 2019.

The shallow water Perla field, located in the Cardon 4 block about 80km (50mi) off the coast of Falcon state, holds an estimated 16.3 trillion ft? of gas in place.

PdV has been importing sporadic volumes of Colombian gas under an existing six-month contract which has been repeatedly renewed since the 225km Antonio Ricaurte cross-border pipeline was built in 2007.

At the time, Caracas had pledged to reverse the line in 2012, but PdV was not able to tap its abundant gas reserves until now.

PdV said yesterday that it has only been importing about 20mn ft3/d of Colombian gas since May after "months of completely irregular deliveries and supply interruptions from Colombia."

The company says it plans to start exporting some gas to Colombia in the second half of 2015.

But in the initial stage of development, all of Perla?s gas production will go to the 940,000 b/d CRP oil refining complex on the nearby Paraguana peninsula, and to thermal power plants in northwestern and central Venezuela operated by state-owned utility Corpoelec, displacing some imported diesel. The condensates will be exported.

Perla, the largest industrial development in Venezuela in many years, represents a rare economic success for the government of President Nicolas Maduro, who faces rising popular discontent over triple-digit inflation, acute food shortages and rampant violent crime. Gas and condensates exports will also help to shore up the government?s dwindling reserves of hard currency.

In spite of delays, the Perla launch contrasts with stalled development of Venezuela?s Orinoco extra-heavy oil belt, where PdV?s new joint ventures are only producing a total of around 60,000 b/d.

Unlike gas developments, where foreign companies like Repsol are allowed to spearhead projects with PdV later farming in, the cash-starved state-owned company is obligated to take a controlling stake in oil projects, which it cannot fund on its own.

Maduro is scheduled to head a high-profile inauguration ceremony for Perla sometime this month.

For Colombia, the cessation of exports to Venezuela will be a small reprieve because of a looming gas shortage. The country plans to start importing LNG by the end of next year.