From
Trinidad and Tobago to Qatar
Trinidad Express
Caracas
Petroleumworldtt.com
05 06 07
Venezuela signed agreements last week with five
foreign oil companies to hand over operations of
four massive Orinoco heavy oil projects, with ConocoPhillips
alone failing to sign the accords.
Leftist President Hugo Chavez in February decreed
that the projects be converted to joint ventures
with a majority held by state oil company PDVSA
as part of a nationalization drive to advance his
self-styled socialist revolution.
ConocoPhillips has the heaviest presence of any
foreign company in Venezuela's vast Orinoco belt,
holding the largest stakes in two of the four projects
that can turn tar-like crude into around 600,000
barrels per day of synthetic oil.
Oil Minister Rafael Ramirez complained about Conoco's
negotiating tactics and warned that their refusal
to sign a deal meant the US company was less likely
than the others to remain in its projects.
"They have not understood anything. They'll
see," the minister Ramirez told Reuters.
"The path of signing this agreement here
would have made this issue a lot easier for them," he
told reporters.
ConocoPhillips CEO James Mulva said that the company
expected to hand operations over by May 1 without
problems, but said discussions over future participation
in the Orinoco would go on much longer.
"In terms of the expropriation, of PDVSA
increasing their ownership ... those discussions
will continue on for some time beyond the first
of May," Mulva said.
Officials and company representatives said last
week's agreements involved formally starting negotiations
over how to transform the existing companies into
new joint ventures with a majority held by PDVSA.
The ceremony also included agreements for private
operators to give PDVSA control over risk sharing
agreements signed during the 1990s, though Conoco
and Italy's Eni did not sign these accords either.
The takeovers pit the fourth-largest oil exporter
to the United States against some of the world's
largest companies in the struggle for control over
four projects valued in total at over US$30 billion.
Exxon Mobil, Chevron, Britain's BP Plc, France's
Total and Norway's Statoil signed to hand over
their operations on May 1 to Venezuela.
The companies also have until June 26 to negotiate
the terms and conditions of the nationalized projects
in which they can remain minority partners with
state oil company PDVSA holding at least 60 per
cent stake.
Industry analysts say they expect most companies
to work out a way of remaining as partners because
Orinoco is one of the world's largest reserves
and high oil prices allow them to return profits
despite occasional harsh treatment by Chavez.
The government plans to hold a ceremony with fanfare
to mark the operations handover in what Chavez
says is Venezuela reclaiming its sovereignty on
the day leftists around the world celebrate workers'
rights.
Trinidad
Express
Wednesday, May 2nd 2007
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