PdVSA to Pay $56M in Compensation to Paria Gulf Partners
CARACAS, July 03, 2008 (Dow Jones Newswires)
Petroleos de Venezuela SA, or PdVSA, converted the Paria Gulf deals into state-controlled joint-venture companies and agreed to compensate the partners once the fields become commercially viable, according to copies of the unpublished joint-venture contracts reviewed by Dow Jones Newswires.
Under the new agreements, PdVSA would pay ENI, China Petroleum & Chemical Corp. (SNP), known as Sinopec, and Ine Paria, a unit of Caracas-based engineering firm, Inelectra SA, a total of $56 million for their investments in three off-shore ventures, the documents show.
PdVSA, ENI and Inelectra officials declined to comment for this article. Sinopec executives could not be reached for comment.
For President Hugo Chavez's administration, however, the deals fell far short of a controlling share for PdVSA. In 2007, Chavez ordered PdVSA to convert all heavy-oil upgrading projects in the Orinoco basin as well as the
As a result, the
It remains unclear how soon PdVSA could declare the commercial viability of these projects needed to begin the compensation process.
PdVSA's remaining partners in multi-billion dollar heavy-oil projects along the
Chavez's quest to gain greater control over the country's oil sector in recent years began in earnest in early 2006 when the state forced operators of 32 conventional oil fields to convert their operating contracts into state-controlled joint ventures.
Back in 2006, ENI initially refused the terms but then backtracked and kept doing business with PdVSA. The Venezuelan oil company agreed in February to pay ENI $960 million in compensation for the Dacion field it lost to the 2006 contract overhaul. PdVSA had paid off $230 million of that debt, with $730 million left to cover as of March 31, according to PdVSA's first quarter financial report.
Copyright (c) 2008 Dow Jones & Company, Inc.
Operates 14 Offshore Rigs
Manages 26 Offshore Rigs
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Operates 11 Offshore Rigs
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