Total E&P Chief: Still Seeks Venezuela Tax Compromise

Sep 27, 2005 (Dow Jones Commodities News via Comtex) By Benoit Faucon Of DOW JONES NEWSWIRES JOHANNESBURG (Dow Jones)

French oil major Total (TOT) said Tuesday that it hopes to reach a compromise on a tax dispute with the Venezeulan government, a senior company official said.

"Talks are still going on," said Christophe de Margerie, president of Total's Exploration and Production division, adding that the company isn't opposed to the new tax law, but would like to reach a compromise on the amount.

"It's normal to renegotiate taxes when contracts were signed when (oil) prices were at $15 a barrel and have now reached $60/bbl," he told reporters on the sidelines of an oil conference in Johannesburg.

But De Margerie said Venezuela "can't enforce" its threat to force oil companies to grant state-owned PdVSA a larger stake in their projects.

Separately, De Margerie declined to say if Total's Kashagan oil project in Kazakhstan was on budget or not.

"The plans have been changing many times so it's difficult" to say if the latest estimate is respected or not, he said.

De Margerie said costs could be higher than initially planned because of the "complexity of the field and because we want to increase output quickly."

ENI SpA (E) is the operator of the giant field and Total is a minority partner.

The executive said that even if costs rose, the project would still be "economical."

Regarding Africa, de Margerie said Total is in talks to participate in several projects.

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