Feb 9 (Reuters) - Venezuela on Wednesday will declare the winners of the Carabobo oil auction in the vast Orinoco heavy crude belt, the first major oil industry investment opportunity during leftist President Hugo Chavez's 11-year presidency.

The government received offers from majors including Chevron (CVX.N: Quote, Profile, Research) and Repsol (REP.MC: Quote, Profile, Research) and state oil companies such as India's ONGC (ONGC.BO: Quote, Profile, Research) and Malaysia's Petronas (PETR.KL: Quote, Profile, Research), less than three years after Chavez nationalized projects in the same area. [ID:nN09244390]

The following are some details about the Carabobo bid:

PROJECTS

The auction consists of seven blocks organized into three projects with similar surface areas containing a total of 127.9 billion barrels of oil in place.

Projects 1 and 2 have reserves of around 31 billion barrels each. Project 3 has reserves of around 66 billion barrels, but its complex geology make it more difficult to operate.

The government believes a total of 25.6 billion barrels are recoverable in the three projects, based on a recovery rate of 20 percent.

Investment is expected to reach between $10 billion and $20 billion per project, with the upgraders alone costing between $6.5 billion and $12 billion each

All three projects are slated to produce 400,000 barrels per day (bpd). They include the construction of a heavy crude upgrader that can turn 200,000 bpd of tar-like Orinoco oil into lighter and more valuable synthetic crude.

The remaining 200,000 bpd of Orinoco oil will be blended with lighter oil to yield an intermediate grade. The projects are due to begin production between 2012 and 2013.

The upgraders, to be built in the isolated town of Soledad on the Orinoco river, are scheduled to be on line in 2016-2017. Upgraded crude will be transported in pipelines to a shipping terminal to be built on the Araya peninsula.

BONUSES AND FINANCING

Companies must pay bonuses of at least $1 billion for access to the reserves in Projects 1 and 2 and $500 million for Project 3. The bonuses are to paid in three installments after the joint ventures are created, perhaps in March.

Each offer must include direct financing to PDVSA of at least $1 billion, payable progressively.

The Energy Ministry calculates early production income -- revenues from crude sold before upgraders are functioning -- of $5 billion to $6 billion for each of the three projects in the first four years. That will help finance upgrader construction.

BIDDING

Two consortia including eight companies made offers for the three blocks, sources close to the process told Reuters.

One consortium is made up of Chevron, a group of Japanese companies and Venezuela's Suelopetrol; the other includes Repsol, Petronas and ONGC.

In 2008, 19 companies interested in joining state oil firm PDVSA as minority partners paid $2 million each for a data pack with geological details of the areas on offer.

TAXES AND GOVERNANCE

Venezuela softened its tax terms in this auction as the drop in oil prices forced Venezuela to retreat from years of tightening fiscal terms.

The royalty is expected to drop to 20 percent from 33.3 percent to help companies recover costs faster.

Companies will pay 50 percent taxes on profits, and the government expects total take will be 64 percent of revenues, well above the minimum of 50 percent established by law. The ministry is expected to seek an exemption from a windfall tax, or at least a reduction in the rate.

Private firms will play a larger role in managing the projects than in current joint ventures with PDVSA, taking 40 percent of the primary and secondary posts.

International tribunals will get involved only to resolve conflicts that arise regarding project financing.

(Reporting by Marianna Parraga, Writing by Brian Ellsworth; Editing by Lisa Shumaker)