VENEZUELA NEGOTIATES MAJORITY STAKE IN OIL DEVELOPMENT CONTRACTS, TWO U.S. OIL COMPANIES BAIL OUT.
US oil giants ExxonMobil and ConocoPhillips appeared to be ending their operations in Venezuela as the government of President Hugo Chavez negotiated contracts in which the nation would maintain at least a 60% stake in petroleum-development projects along the country's Orinoco Belt (Faja de Orinoco). Four other major multinationals accepted the government's terms and a major Chinese company expressed an interest in developing projects in the region.
The negotiations come as part of Chavez's promise to bring greater national control over Venezuela's most important industry. Venezuela is also South America's largest oil exporter (see NotiSur, 2007-05-18).
ExxonMobil and ConocoPhillips refuse terms, miss signing deadline
On June 26, the Venezuelan government announced ExxonMobil and ConocoPhillips had failed to meet a deadline on new terms that would have seen Venezuela take majority control. Four other companies--BP, Chevron, France's Total, and Norway's Statoil--agreed to deals that would see Venezuela holding a 60% to 83% stake in the projects, with state oil company Petroleos de Venezuela SA (PDVSA) taking the central role in production.
Venezuelan Energy Minister Rafael Ramirez said after the negotiations, "To the companies that have taken a stake in our country, a stake in our future, welcome! You can count on support from the Venezuelan government, on the support of our national company Petroleos, to jointly develop the immense businesses and opportunities that we have shaped in our national design for the development of the Orinoco oil belt."
ExxonMobil said it was "disappointed" that it was unable to reach an agreement on the terms of a joint-ownership structure but added that it was in discussions with the Venezuelan government on a way forward. The company reportedly has about US$3.5 billion invested in Venezuela.
In May, PDVSA took over control of exploration projects in the Orinoco Belt, which had been among the last privately run fields in the country. As older fields elsewhere go into decline, development of the Orinoco is seen as key to Venezuela's future production.
It is the country's most important oil area, with massive potential. There are proven reserves of at least 80 billion barrels, but there could be enough there to make Venezuela the world's biggest source of oil, holding perhaps as much as 316 billion barrels.
Chavez demanded that private companies hand over majority control to the state as part of a nationalization...
Para continuar leyendo
Solicita tu pruebaCOPYRIGHT GALE, Cengage Learning. All rights reserved.
