Ministry Submits Contract Model for New E&P JVs to National Assembly

Venezuela's energy and oil ministry finally delivered its proposed contract model to regulate 32 joint ventures between state oil firm PDVSA and private oil companies to the national assembly on Thursday night, PDVSA said in a press release.

PDVSA president and energy and oil minister Rafael Ramirez gave the document to the national assembly president Nicolas Maduro.

The first step is for Maduro to send it to the assembly's energy and mines commission. After the commission has approved it, it will then be sent to the full assembly for a vote.

Very little is known of what the contracts will be like, but PDVSA says that "this framework reaffirms the state's ownership of the reserves, the royalty and tax rates that apply for the oil sector, the monopoly of commercialization for PDVSA and the resolution of disputes in national courts."

Details of the new model will be announced in a seminar to be held by the ministry and PDVSA in the coming days, the statement said.

The fields to be included in the PDVSA-led joint ventures currently produce about 500,000 barrels a day of medium to light crude. Ramirez has repeatedly said that PDVSA will have a stake of 60% to 70% in each new joint venture.

Last year Venezuela unilaterally decided to rescind 32 operating agreements and turn them into E&P joint ventures, arguing the agreements were costing PDVSA too much money.

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