Article

2007-04-18 Caribbean-Latin America

Venezuela might not pay foreign firms in oil takeover

PORLAMAR, VENEZUELA Venezuela threatened Tuesday not to compensate some foreign oil companies in its planned takeover of their multibillion-dollar projects in the OPEC nation's vast Orinoco reserve.

The warning from the oil minister has intensified the pressure the leftist government of President Hugo Chavez has exerted on some of the world's largest companies as they negotiate before a June deadline over the nationalizations.

"We are all talking. There are permanent conversations with all the partners," the oil minister, Rafael Ramirez, told reporters on the sidelines of an energy summit on the Venezuelan resort island of Margarita.

"We are going to see if there's compensation because in some cases there may not be compensation," he added.

Companies whose investments are targeted for takeover in the reserve of tarry crude are Chevron Corp., Exxon Mobil Corp., ConocoPhillips, Norway's Statoil, Britain's BP and France's Total.

Tuesday's threat was the first time that Venezuela explicitly said the companies might not be compensated for losing investments in the four heavy crude upgrader projects, which are valued at more than $30 billion and can produce 600,000 barrels per day.

It reflected the tough negotiating tactics ordered by Chavez, who often rails at capitalism even though he says he is not ejecting the companies from the South American nation in his self-styled socialist revolution.

Compensation was already an issue in the talks to allow Venezuela to take majority control of the projects. Despite raising billions of dollars this year in financing on international markets, Venezuela had previously warned that it did not want to give compensation in cash and that it would possibly offer some kind of payment in oil.

Venezuela's state oil company will take over the operation of the projects May 1. The new makeup of the joint ventures' ownership should be finalized by June 26.

Posted by mrp 2007-04-18 09:35|| || Front Page|| [11136 views since 2007-05-07] Top

#1 And anyone really thought they would? Venezuela already doesn't pay contractors that come in and help. Why would they pay for stealing the whole operation?

Posted by DarthVader">DarthVader 2007-04-18 12:05|| 2007-04-18 12:05|| Front Page Top

#2
Down-hole equipment will be dropped down hole.

Posted by Master of Obvious 2007-04-18 12:29|| 2007-04-18 12:29|| Front Page Top

#3 What do they say? ... "You get what you pay for?"

Posted by twobyfour 2007-04-18 13:54|| 2007-04-18 13:54|| Front Page Top

#4 Pull all foreign personnel out, with the last man setting off a massive explosion in the most critical junctures. Let Chavez "fix the problem".

Posted by Old Patriot">Old Patriot 2007-04-18 14:05|| http://oldpatriot.blogspot.com/]">[http://oldpatriot.blogspot.com/] 2007-04-18 14:05|| Front Page Top

#5 The oil companies have been annoyed by such nonsense for too long, and I suspect that they are willing to invest a fraction of their investment in private organizations that would help resolve the conflict.

If you know what I mean and I think you do.

Posted by Anonymoose 2007-04-18 14:12|| 2007-04-18 14:12|| Front Page Top

#6 Retaliation isn't really necessary. The whole world now knows how it will go for them if they sink any money into Venezuela. Only an idiot (or the Chinese) would put money into that basket case of a country now.

Posted by Crolugum Ghibelline5943 2007-04-18 14:20|| 2007-04-18 14:20|| Front Page Top

#7 What does one expect from Communists when they see a free source of money? Best to sabotage the whole place as we leave. Let Chavez and his buddy fidel did the tar out using shovels and socialist solidarity.

Posted by ed 2007-04-18 14:24|| 2007-04-18 14:24|| Front Page Top

#8 Ya' beat me to it, #4 OP.

Posted by Barbara Skolaut">Barbara Skolaut 2007-04-18 14:28|| http://ariellestjohndesigns.com/]">[http://ariellestjohndesigns.com/] 2007-04-18 14:28|| Front Page Top

#9 Crippling the production facilities is not enough. What is the upshot of Chavez ~~appropriating~~ stealing so much foreign investment? Try higher prices at the pump while Chevron, Exxon and Mobil try to recoup their financial losses. We pay for this bullshit and pay dearly. Is anyone else sick and tired of this crapulence? Iran did the same damned thing and got away with it. It's time to end this fatuous charade and start making it a painful proposition to fuck with our national interests.

If Chavez feels entitled to expropriate our assets, we have the right to fry his worthless ass for grand theft. Once again, TYRANNIES HAVE NO SOVEREIGN RIGHTS!

If this turd isn't going to play fair why should we make nice him?

Posted by Zenster">Zenster 2007-04-18 15:07|| 2007-04-18 15:07|| Front Page Top

#10 Do I smell Helms-Burton Act Part Dos?

Posted by Procopius2k 2007-04-18 15:53|| 2007-04-18 15:53|| Front Page Top

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