Venezuela plant takeovers Tulsa company ?

CARACAS, Venezuela — President Hugo Chavez’s government says it is seizing 14 natural gas compression plants as it moves forward with the takeover of private companies in Venezuela’s oil industry.

Venezuela’s state oil company has taken control of 75 oil contractors amid payment disputes and plunging world oil prices, using a law approved by the largely pro-Chavez National Assembly last month. Chavez’s government now says it will proceed with more takeovers over the next five days, according to a statement Wednesday by Venezuela’s Information Ministry.

The law says nationalized companies could be paid with cash or bonds and the government has agreed to pay those companies involved in some past takeovers.

Those affected include Houston-based gas processor and distributor Exterran Holdings Inc. The company said in a filing with the U.S. Securities and Exchange Commission on Tuesday that state-run Petroleos de Venezuela SA, or PDVSA, began taking over its operations that same day.

Exterran said it had already been affected through the seizure of three joint ventures in which it has minority stakes — including SIMCO consortium, which injects water into oil fields to improve recovery, and two gas plants in eastern Venezuela owned by Williams Cos. Inc., based in Tulsa.

But Tuesday’s seizures represent the first takeover of Exterran’s "wholly owned operations”— which accounted for about 5 percent of the company’s total revenues last year, the company said.

In April, Exterran said it was experiencing long payment delays from PDVSA.

Venezuela’s state oil company has fallen behind on billions of dollars in payments as it aims to cut costs by 40 percent.

PDVSA’s unpaid invoices jumped 145 percent over 2007, to reach $13.9 billion in December, Venezuela’s Energy Ministry reported.




by the associated press

Venezuela takes command

CARACAS, Venezuela — Venezuela’s state oil company said Tuesday that it has taken control of 90 percent of oil contractors on western Lake Maracaibo as it aims to reduce costs due to falling prices for crude oil.


President Hugo Chavez announced last week that Venezuela is nationalizing 60 oil contractors as his government moves to assert control over the industry under a law approved by the pro-Chavez National Assembly.

Many of the contractors run boats, docks and other facilities on Lake Maracaibo in oil-rich Zulia state, while others process natural gas or inject water into oil fields to help extract crude oil.

State-run Petroleos de Venezuela SA, or PDVSA, has recently clashed with domestic and foreign service providers, falling behind on billions of dollars in payments as it aims to cut costs by 40 percent.

Venezuela’s Energy Ministry says PDVSA’s unpaid invoices jumped 145 percent last year over 2007, to reach $13.9 billion in December.

What the U.S. is doing
The U.S. government is "monitoring the situation” and has been in close contact with companies that could be affected through its embassy in Caracas, U.S. State Department spokesman Noel Clay said Tuesday.
"In the event of expropriation, we expect the Venezuelan government to provide U.S. companies with prompt, adequate and effective compensation in accordance with international law,” Clay said in Washington.

Oil Minister Rafael Ramirez said some contracts negotiated at last year’s soaring crude prices are now overvalued. "We’re not going to pay abusive rates to anybody,” he said Tuesday. Venezuela relies on oil for 93 percent of exports, but has seen world oil prices fall 60 percent since their July peak.

A barrel of light, sweet crude was trading at $58.73 Tuesday.



by the associated press