Chavez announces May takeover of all Venezuela oil fields

Special to World
Friday, February 9, 2007

Leftist dictator Hugo Chavez of Venezuela has threatened to take control of all oil fields by May and remove them from the control of U.S. and foreign oil companies, a move that could severely limit U.S. oil imports.

Chavez said last week that the oilfields of the Orinoco Belt would be placed under state control and that it would be up to the foreign companies currently operating the concessions whether to remain as minority partners with state-owned PDVSA (Venezuelan Petroleum, Inc.) or to quit the Andean nation.

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"What we want is to negotiate," Chavez said. “But I have given instructions to the effect that May 1, all those fields greet the dawn under our control.

"When the law is made and we take control of those fields, the employees of those firms will be on the payroll of PDVSA, with all the rights and duties of a worker" at the state enterprise, Chavez said during a press conference at Miraflores, the presidential palace.

Venezuela is the world's fifth-leading oil exporter and the No. 4 supplier to the United States. The oilfields in the Orinoco Belt have been operated over the past 10 years in "strategic partnerships" between PDVSA and companies including ExxonMobil, Chevron, Conoco-Phillips, Total and BP.

The Orinoco sector is now producing around 600,000 barrels per day and is thought to hold massive reserves of extra-heavy crude. U.S. sources say the nationalization is a serious threat to U.S. energy resources. “They cannot operate the fields and production will go down fast and it is a big source of oil supply for U.S.,” said one industry expert.

Copyright © 2007 East West Services, Inc.

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