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Wed Jul 2, 8:37 PM

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By Rachel Jones, The Associated Press

CARACAS, Venezuela - Venezuela's state oil company said net income rose 80 per cent in the first quarter as world oil prices soared.

Petroleos de Venezuela SA, or PDVSA, said late Tuesday that net income reached US$3.5 billion in the quarter ending March 31 - up from US$1.9 billion in the same period last year.

Export earnings rose 53 per cent to US$30.7 billion, even as exports fell by one per cent over the year-ago period, buoyed by soaring oil prices.

Venezuelan crude, which is heavier than benchmark crude traded worldwide, averaged US$88 per barrel for the quarter, up 81 per cent from last year. On Wednesday, light, sweet crude for August delivery rose to a record $144.32 on the New York Mercantile Exchange after regular trading hours ended.

PDVSA increased spending by 38 per cent to US$24.3 billion, buying 13 oil rigs from China since last year. All but two have arrived, the company said in June. Operational costs increased in the heavy-crude rich Orinoco Belt, where the government took a majority stake in four large oil projects last year, the company said.

Investment in oil and gas exploration, production and other things meanwhile increased 46 per cent in the first quarter to US$1.7 billion. The company plans to invest a total of US$15 billion this year to boost production to 3.4 million barrels per day by the end of 2008, PDVSA vice president Luis Vierma has said.

PDVSA says it now produces 3.2 million barrels of crude per day, but the Paris-based International Energy Agency, an energy advisory group, says output is closer to 2.4 million barrels a day.

The state oil company funnelled US$2.7 billion into social spending in the first quarter, more than half of which went to Venezuela's Development Bank, which finances infrastructure and other projects. The rest helped fund government health care, literacy and other programs. PDVSA's social spending increased fourfold over the year-ago period - amounting to 59 per cent more than PDVSA spent on investment in the first quarter.