Venezuela seizes oil field
Caracas
President Hugo Chavez has tightened his grip on Venezuela's oil resources, following through on threats to not do business with international oil companies that resist government control of the nation's oil fields.
Venezuela seized an oil field from France's Total SA and terminated a contract with Italy's Eni SpA after the companies did not comply with a government demand that control of 32 fields be turned over to the government, the companies said on Monday.
Other companies, including Exxon Mobil Corp, have decided to sell their stakes in Venezuelan oil properties rather than go along with the new terms.
First time
The move to take over the Total field was the first time state oil company Petroleos de Venezuela SA, or PDVSA, has seized control of an oil field as part of Chavez's effort to draw more revenue from companies pumping crude in the South American country.
PDVSA "took control of our operations at Jusepin. It was during the weekend," Total spokesperson Patricia Marie said.
Marie was unable to immediately provide further details, including how many Total employees work at the site.
The 30 000 barrel-a-day Jusepin oil field is one of 32 in the country that have been run by private oil companies under contract with the government. Venezuela demanded last year those contracts be changed into joint ventures that give PDVSA a minimum 60% stake.
Most accepted without a fight
Many oil companies have accepted the new terms without a fight, apparently betting that the ventures would still be profitable even with a larger share of revenue going to the state.
On Friday, 17 companies, including Spanish-Argentine Repsol YPF, Royal Dutch Shell PLC and China National Petroleum, signed on to the new legal framework after congress approved guidelines for the joint ventures.
"We didn't migrate the field ... and PDVSA took it. That's logical," Marie said, adding the company had not made any formal decision yet on how to proceed.
The news came shortly after Italian oil and gas company Eni SpA said PDVSA had terminated its contract at a separate oil field on Saturday and was moving to take control of the installations there.
PDVSA had informed the company that management of operations at the site will be transferred to personnel appointed by the state oil company, Eni said in a statement on Monday.
Violation of contract rights
Eni said it would comply with PDVSA's request to hand over the operations but said the company expected to be compensated for a "violation of contract rights."
"It is Eni's intention to offer PDVSA a period of time in which a full reparation of Eni's contract rights can be agreed," it said.
Eni, which had a 100% stake in the Dacion field, said it would take legal action if an agreement could not be reached.
The government claims Eni and Total owe millions of dollars in unpaid taxes and had earlier said that unless those debts are paid off, they would not be permitted to continue operating the fields.
Total's Marie said the company was examining the tax issue but denied a report by the state-run news agency that Total would pay off its remaining debts by Tuesday.
Norway's Statoil ASA, another company that didn't sign an agreement to accept the changes, said on Monday it is selling its 27% share in the LL 652 oil field in Lake Maracaibo to PDVSA. Statoil said the sale means that it won't have a holding in the field any longer. The value of the deal wasn't disclosed.
Statoil said in a statement, however, that it was still open to considering new investments in Venezuela.
Exxon Mobil also avoided the new terms by selling its stake in the 15 000-barrel-a-day Quiamare-La Ceiba field in December to its partner, Repsol. Venezuelan Oil Minister Rafael Ramirez said last week that since Exxon Mobil resisted, "we don't want them to be here."
But the Irving, Texas-based company said it has no plans to pull out of Venezuela. It still holds a 41.7% stake in the 120 000-barrel-day Cerro Negro heavy oil upgrading project in the Orinoco River basin along with partners BP and PDVSA.
President Hugo Chavez has tightened his grip on Venezuela's oil resources, following through on threats to not do business with international oil companies that resist government control of the nation's oil fields.
Venezuela seized an oil field from France's Total SA and terminated a contract with Italy's Eni SpA after the companies did not comply with a government demand that control of 32 fields be turned over to the government, the companies said on Monday.
Other companies, including Exxon Mobil Corp, have decided to sell their stakes in Venezuelan oil properties rather than go along with the new terms.
First time
The move to take over the Total field was the first time state oil company Petroleos de Venezuela SA, or PDVSA, has seized control of an oil field as part of Chavez's effort to draw more revenue from companies pumping crude in the South American country.
PDVSA "took control of our operations at Jusepin. It was during the weekend," Total spokesperson Patricia Marie said.
Marie was unable to immediately provide further details, including how many Total employees work at the site.
The 30 000 barrel-a-day Jusepin oil field is one of 32 in the country that have been run by private oil companies under contract with the government. Venezuela demanded last year those contracts be changed into joint ventures that give PDVSA a minimum 60% stake.
Most accepted without a fight
Many oil companies have accepted the new terms without a fight, apparently betting that the ventures would still be profitable even with a larger share of revenue going to the state.
On Friday, 17 companies, including Spanish-Argentine Repsol YPF, Royal Dutch Shell PLC and China National Petroleum, signed on to the new legal framework after congress approved guidelines for the joint ventures.
"We didn't migrate the field ... and PDVSA took it. That's logical," Marie said, adding the company had not made any formal decision yet on how to proceed.
The news came shortly after Italian oil and gas company Eni SpA said PDVSA had terminated its contract at a separate oil field on Saturday and was moving to take control of the installations there.
PDVSA had informed the company that management of operations at the site will be transferred to personnel appointed by the state oil company, Eni said in a statement on Monday.
Violation of contract rights
Eni said it would comply with PDVSA's request to hand over the operations but said the company expected to be compensated for a "violation of contract rights."
"It is Eni's intention to offer PDVSA a period of time in which a full reparation of Eni's contract rights can be agreed," it said.
Eni, which had a 100% stake in the Dacion field, said it would take legal action if an agreement could not be reached.
The government claims Eni and Total owe millions of dollars in unpaid taxes and had earlier said that unless those debts are paid off, they would not be permitted to continue operating the fields.
Total's Marie said the company was examining the tax issue but denied a report by the state-run news agency that Total would pay off its remaining debts by Tuesday.
Norway's Statoil ASA, another company that didn't sign an agreement to accept the changes, said on Monday it is selling its 27% share in the LL 652 oil field in Lake Maracaibo to PDVSA. Statoil said the sale means that it won't have a holding in the field any longer. The value of the deal wasn't disclosed.
Statoil said in a statement, however, that it was still open to considering new investments in Venezuela.
Exxon Mobil also avoided the new terms by selling its stake in the 15 000-barrel-a-day Quiamare-La Ceiba field in December to its partner, Repsol. Venezuelan Oil Minister Rafael Ramirez said last week that since Exxon Mobil resisted, "we don't want them to be here."
But the Irving, Texas-based company said it has no plans to pull out of Venezuela. It still holds a 41.7% stake in the 120 000-barrel-day Cerro Negro heavy oil upgrading project in the Orinoco River basin along with partners BP and PDVSA.
posted by Alice at
Monday, April 03, 2006
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