UPDATE: Total Considering JV Oil Deal With Venezuela's PdVSA

French firm Total (TOT) is considering signing a joint venture deal with Venezuela state firm Petroleos de Venezuela to develop an oil block in the extra-heavy crude Orinoco belt, an official said Wednesday.

Speaking at an oil conference in Caracas, Total's director of exploration and production for the Americas, Michel Seguin, said the deal would be for the Junin 10 block.

Eulogio Del Pino, PdVSA's director of exploration and production, said PdVSA is also studying the possibility of instead signing the joint venture deal for Junin 10 with Norway's StatoilHydro ASA (STO.OS). Another option would be to ink a deal with both StatoilHydro (STO) and Total, he said.

"The idea is to evaluate which option is better of the two firms, and also to see if we can combine [the two] or go with just one company," Del Pino told reporters on the sidelines of the conference.

Plenty of reserves have already been proven at the oil block, and Del Pino said it could produce between 200,000 and 300,000 barrels a day of extra-heavy crude. He added that a decision on what firms would be involved in Junin 10 would be announced by the end of the year.

The Junin 10 block is separate from Venezuela's Carabobo bidding round, in which seven other oil blocks are up for auction. That bidding round, in which most major oil firms have showed some interest, has been postponed several times as PdVSA and the companies negotiate terms.

Another meeting between PdVSA and oil companies regarding Carabobo is set for Tuesday, and PdVSA officials said they're confident the auction will occur before the end of the year.

All of the blocks would be joint ventures, with PdVSA owning 60% and the other 40% going to the private firms or consortiums.

The comments regarding Junin 10 come a day after PdVSA said that Total would spend $25 billion on oil projects related to the Junin 10 block, including construction of a refinery or upgrader.

A unnamed Total official confirmed that such investment plans were being considered, but were "not a fact."

-By Dan Molinski, Dow Jones Newswires; (58) 212-284-5651; [e-mail]