Chávez strikes oil deal with France-based Total

[Say_What]

From the Oligarchs Daily aka the Miami Herald. Exxon is the only country challenging the new Venezuela hydrocarbon laws.

<clips>

Total SA, Europe's third-largest oil company, will begin talks next week with Venezuela for a $5 billion expansion of a heavy-oil joint venture in the South American country, Venezuelan President Hugo Chávez said.

Total agreed to create the venture under Venezuela's new oil law and pay a higher royalty, Chávez said in a televised press briefing after meeting French industrialists in Paris. Venezuela is the world's fifth-largest oil exporter.

''We have given the green light'' to expand the Sincor venture, Chávez said. ``Today in Paris Sincor II has been born.''

Total is moving ahead with the project while rival Exxon Mobil Corp. of Irving, Texas, challenges Venezuela's October decision to raise royalties on four heavy-oil joint ventures. Chávez said the country was within its rights to raise the royalty rate to 16.67 percent from 1 percent without consulting its foreign partners.

''Of course the new law will apply'' to Total, Venezuelan Energy and Oil Minister Rafael Ramirez said in an interview in Paris. ``All the companies have to obey the law.''

http://www.miami.com/mld/miamiherald/business/international/latin_america/11094335.htm

[msongs]

1. "all the companies have to obey the law" - that's un-American>>>

but then, venezuela is NOT Amurrika.


Msongs
www.msongs.com/vvpb our paper ballot proposal for CA

[Blue to the bone]

2. This is great! Total is well-respected locally!

The company has had significant operations for a number of years in an area called Jusepin and have been a good corporate neighbor....they're well-received for their employment practices.

[Say_What]

5. I was not aware that France is the largest investor in Venezuela :-) n/t

[cthrumatrix]

3. "companies have to obey the law"....next move US Companies

[Name removed]

4. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Blue to the bone]

6. There's more to the original agreement than just a 1% royalty....

If I remember correctly, half of each barrel of oil produced under the production sharing agreement is credited to the Venezuelan government while the multi-national is responsible for 100% of the costs associated with producing it.

[Judi Lynn]

7. It's downright shocking. They've been getting it for almost NOTHING.

Rape is an appropriate description for what has been going on all this time. Hope Latin America finds a way to block this long-lived criminal behavior/custom by certain enormous companies and their allies within the American right-wing.

Here's more about Exxon vs. Venezuela from today:

Venezuela, Exxon Mobil to review royalty hike
Thu Mar 3, 2005 12:49 PM ET
CARACAS, Venezuela, March 3 (Reuters) - Venezuela's government will meet with U.S. oil major Exxon Mobil Corp. (XOM.N: Quote, Profile, Research) to discuss last year's decision to increase royalties paid by foreign oil firms involved in heavy-crude upgrade ventures, Exxon Mobil said Thursday.
Venezuelan President Hugo Chavez last October ended a tax holiday for four foreign-financed multibillion-dollar ventures with state oil firm PDVSA, including the Mobil Cerro Negro project, which Exxon Mobil operates.
"The Ministry of Energy has agreed to meet with us to discuss our concerns on the royalty rate change. We reiterate that we wish to achieve an amicable solution to the issue," Mobil Cerro Negro said in a statement.
Exxon Mobil did not say when the meeting would take place, but added that officials hoped discussion would start soon.

Venezuelan Energy Minister Rafael Ramirez has said the increase in royalties, which ended a tax holiday put in place when the joint-venture contracts were signed in the 1990s, was legal and not negotiable. He said the government would meet with Exxon Mobil to discuss the change, however.
(snip/...)

http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh17525_2005-03-03_17-49-18_n03275805_newsml



Venezuela's Energy Minister
Rafael Ramirez

~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Welcome to D.U. :hi: :hi:

[Blue to the bone]

8. Many of the Production Sharing Agreements turned out not to be....

...profitable. That included a number that were sold to companies from Argentina and the UK as well as the US.

For the most part, these deals involved old, non-productive, or marginally productive fields that required a lot of investment and technology that PDVSA did not have, or did not want to expend on such fields. PDVSA's intent was to focus its energies on newer fields and those yet to be discovered.

Some of these deals were profitable, some were not. A number of companies operating locally pulled out, even before the new royalty levels were applied.

[David__77]

9. Wise strategy for "multipolarization."

Venezuela is in unity with China, Russia, socialist countries and developed countries like France who want to break up the unipolar world order and more to a multipolar world order--this cause is just.