The Mercedes, Palacio, and Guavinita oil fields are located in the north-central part of the state of Guarico, which is situated near the western end of the Eastern Venezuelan geosyncline. Seventy-two reservoirs were productive in the Greater Mercedes area, as of June, 1953, with 24 others shut in or abandoned. Production amounted to 24,340 barrels per day during the first 6 months of 1953.

Oil is produced from formations of Cretaceous and Oligocene age which, farther east, occur in different facies or are absent entirely. The Cretaceous, represented by the Temblador group, is now subdivided into four new formations. The thickness of this group varies from zero to more than 2,500 feet. The Oligocene, which overlaps the Cretaceous, is represented by the La Pascua, Roblecito, and Chaguaramas formations. The first two units attain a combined maximum thickness of 9,000 feet in the northern part of the area. They are overlain by the Chaguaramas formation, considered equivalent to the Periquito (Merecure) and Oficina formations. Although the Chaguaramas is now truncated by erosion, and therefore incomplete, a projection of rates of thickening suggests that the original thickne s was as great as 14,000 feet in the present foothills zone.