Chavez Gives Foreign Companies in Orinoco Projects May 1 Ultimatum

Orinoco Heavy Oil Belt
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The foreign companies that partner Venezuelan state oil firm PDVSA in Orinoco upgrade projects have until May 1 to adapt their structures to new joint ventures in which PDVSA is to have at least 60%, President Hugo Chavez said on Thursday afternoon.

"I'm sure they will accept because we will continue to be partners, but if they do not agree, they are free to leave," Chavez said, according to state news agency ABN.

The president said a new ad hoc law may be necessary to regulate the new ventures, which currently produce some 600,000b/d of synthetic crude.

Chavez was granted special powers on Wednesday by the national assembly that allow him to rule by decree in matters he deems "strategic."

The four Orinoco projects are Ameriven, Cerro Negro, Sincor and Petrozuata. Partners include BP (NYSE: BP), ConocoPhillips (NYSE: COP), Chevron (NYSE: CVX), ExxonMobil (NYSE: XOM), Total (NYSE: TOT) and Statoil (NYSE: STA).

PDVSA currently has stakes of around 40% in each of the projects.

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