Ramirez: No Compensation for Total, Eni

Venezuela will not pay France's Total (NYSE: TOT) or Italy's Eni (NYSE: E) compensation for damages after state oil firm PDVSA took over two fields previously operated by the companies, Caracas daily El Universal quoted energy and oil minister and PDVSA president Rafael Ramirez as saying.

Venezuela "will recognize the investments made" by the two companies in the fields, Ramirez said, according to wire services, from Doha, Qatar, where he is attending an energy conference. However, he said they would not be compensated for damages.

Total and Eni were the only two companies that declined to enter into joint ventures controlled by PDVSA to operate their respective Jusepin and Dacion oilfields, which they had been operating for more than a decade.

Although most companies opted to sign the JVs giving PDVSA control, some chose to sell their stakes to third parties rather than be forced into such arrangements.

Total's Jusepin field was forcibly occupied by PDVSA eastern division workers on April 1 and Total workers were prevented from entering the field. On April 3, Ramirez also said Total's refusal to enter into a JV for Jusepin could jeopardize new business ventures for the French company in Venezuela.

After the occupation, Total and the ministry exchanged letters and started negotiations, but these overtures were apparently fruitless. Both Total and Eni officials in Caracas declined comment.

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