Venezuela's PdVSA Sees Slight Drop In 2012 Income, Revenue

CARACAS - Venezuela's state energy giant Petroleos de Venezuela, or PdVSA, saw its net income drop 6.1% to $4.2 billion in 2012 from the previous year and recorded a slight decline in revenue to $124.4 billion, Oil Minister Rafael Ramirez told reporters Friday.

The declines came even as Venezuela's basket of heavy crude oil and petroleum products posted a record price of $103.42 a barrel in 2012. The company also saw its debts with service providers rise by 35% to than $16.7 billion.

The minister explained the results as those of a company not bent on producing profits and one that is expanding its projects at a rapid clip.

"The activity in the oil industry is rising. Everything is growing, everything," he explained.

Mr. Ramirez didn't say how much oil the country produced and exported last year but noted that PdVSA's audited financial report will be released Monday.

The company made investments of $24.5 billion last year in the local industry and plans to invest around $25 billion in 2013 as Venezuela's ruling socialist party looks to advance ambitious plans to sharply increase oil output in coming years. That was a top goal of late leader Hugo Chavez who until his death earlier this month spearheaded PdVSA's transition into the financier and manager of social programs ranging from homebuilding to food distribution.

PdVSA allocated more than $16 billion into social projects last year, including the government's flagship housing-construction initiative.

"They say that we're not making profits but we're paying for social programs using our net income," Mr. Ramirez said. Speaking at the PdVSA headquarters in Caracas, the minister also shot back at a string of media reports in recent weeks that indicated that some of the company's foreign partners are losing patience with long-delayed payments from the Venezuelan government. Mr. Ramirez, who doubles as PdVSA's chief, said that he had recently been visited by heads of Schlumberger, and received letters from Russia's Lukoil and India's ONGC Videsh, all of which reaffirmed their commitment to working in Venezuela. "We are facing an economic war," the minister exclaimed, blaming the recent reports on media speculation. He added that he and his advisers were being bombarded by negative headlines on Venezuela's oil industry, which he called "an attack" on the country.


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