Monthly Archives: June 2010

Jun
28
2010
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Venezuela says will pay for expropriated US rigs

Venezuela will pay Helmerich and Payne for a fleet of oil rigs it seized from the U.S. company, the oil minister said on Saturday, warning that five drills at a Chevron venture were also at risk of nationalization.
Oil Minister Rafael Ramirez announced this week that OPEC member Venezuela was nationalizing 11 rigs belonging to Helmerich and Payne following a year-long dispute over pending payments by state oil company PDVSA.
“Here we pay book value,” Ramirez said. “A process begins by which we establish fair price between the two parties.”
President Hugo Chavez has nationalized most of Venezuela’s oil industry, starting with major heavy-crude projects worth billions of dollars in 2007, then taking over dozens of smaller service companies last year.
Ramirez said the government would not allow the private sector to idle equipment in pay disputes with state-run oil company PDVSA and did not rule out further nationalizations.
“We are not going to let the private companies stop work or boycott in any way our oil operations,” Ramirez said. He mentioned five Wilson drills operating for Petroboscan as one company in trouble with PDVSA.
On PDVSA’s website, Petroboscan is listed as a 115,000 barrel per day joint venture formed in 2006 with U.S. firm Chevron. Chevron says the project produced 90,000 bpd of liquids in 2009 and drilled six development wells.
Chevron is a partner in the multi-billion dollar development of the vast Carabobo field in the tar-like Orinoco oil belt.
PDVSA on Friday said it had reached agreements with 32 other companies over tariffs after the state firm fell behind in payments when oil prices collapsed in 2008.

Article originally published by Reuters

Venezuela will pay Helmerich and Payne for a fleet of oil rigs it seized from the U.S. company, the oil minister said on Saturday, warning that five drills at a Chevron venture were also at risk of nationalization. Oil Minister Rafael Ramirez announced this week that Venezuela was “nationalizing” 11 rigs belonging to Helmerich and Payne following a year-long dispute over pending payments by state oil company PDVSA.

“Here we pay book value,” Ramirez said. “A process begins by which we establish fair price between the two parties.” President Hugo Chavez has nationalized most of Venezuela’s oil industry, starting with major heavy-crude projects worth billions of dollars in 2007, then taking over dozens of smaller service companies last year.

Ramirez said the government would not allow the private sector to idle equipment in pay disputes with state-run oil company PDVSA and did not rule out further nationalizations (expropriations). ”We are not going to let the private companies stop work or boycott in any way our oil operations,” Ramirez said. He mentioned five Wilson drills operating for Petroboscan as one company in trouble with PDVSA.

On PDVSA’s website, Petroboscan is listed as a 115,000 barrel per day joint venture formed in 2006 with U.S. firm Chevron. Chevron says the project produced 90,000 bpd of liquids in 2009 and drilled six development wells. Chevron is a partner in the multi-billion dollar development of the vast Carabobo field in the tar-like Orinoco oil belt.

PDVSA on Friday said it had reached agreements with 32 other companies over tariffs after the state firm fell behind in payments when oil prices collapsed in 2008.

 
Jun
25
2010
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Exxon Comes Out Ahead In Arbitration Despite Venezuela’s Claims

Article published by the Wall Street Journal

-The latest decision from an arbitration panel has given Exxon Mobil Corp. (XOM) an edge over its battle to extract compensation from Venezuelan President Hugo Chavez.
Legal experts say the June 10 decision by a World Bank-affiliated international dispute center allows Exxon to proceed in its claim to be paid for oil-producing assets, estimated to be worth billions of dollars, expropriated by Venezuela in 2007. The decision also bodes well for other companies that are pursuing similar claims against Venezuela, the one the top world’s top 10 crude oil producers.

The latest decision from an arbitration panel has given Exxon Mobil Corp. (XOM) an edge over its battle to extract compensation from Venezuelan President Hugo Chavez.

Legal experts say the June 10 decision by a World Bank-affiliated international dispute center allows Exxon to proceed in its claim to be paid for oil-producing assets, estimated to be worth billions of dollars, expropriated by Venezuela in 2007. The decision also bodes well for other companies that are pursuing similar claims against Venezuela, the one the top world’s top 10 crude oil producers.

 
Jun
25
2010
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Inflation and Recession Deal Venezuela a Double Blow

Much of the world is fixated on Europe’s sovereign-debt problems, but Venezuela is struggling with a homemade economic and financial crisis that is likely to create growing political problems for President Hugo Chávez.
The Venezuelan economy is taking a double hit from a deep recession and high inflation, causing incomes to decline for rich and poor alike. The “strong bolívar” currency was losing value so quickly that the government recently outlawed the only part of the foreign-exchange market where money could trade relatively freely.
Economists say Mr. Chávez’s populist economic policies are at the root of the problems

Today the Wall Street Journal reports on the fragile state of the economy in Venezuela. Much of the world is fixated on Europe’s sovereign-debt problems, but Venezuela is struggling with a homemade economic and financial crisis that is likely to create growing political problems for President Hugo Chávez.

The Venezuelan economy is taking a double hit from a deep recession and high inflation, causing incomes to decline for rich and poor alike. The “strong bolívar” currency was losing value so quickly that the government recently outlawed the only part of the foreign-exchange market where money could trade relatively freely.

Economists say Mr. Chávez’s populist economic policies are at the root of the problems…