Revenge can be so sweet. Venezuelan President Hugo Chavez has been “quietly courting” Western oil companies to invest in that country’s riches, according to a recent article in The New York Times. In keeping with my earlier blog about the commodity price drop easing nationalist tendencies, the article reported that senior officials have begun soliciting bids from companies such as Chevron, Royal Dutch/Shell, and Total, “promising them access to some of the world’s largest petroleum reserves.” I’m sure some of these companies have long enough memories to recall that just recently Chavez had driven off these investors by nationalizing foreign assets and raising royalties. ConocoPhillips and ExxonMobil both walked away from their assets and have been fighting legal battles over the lost investment. But the opening of vast reserves has its appeal. “Their willingness to even consider investing in Venezuela reflects the scarcity of projects open to foreign companies in other top oil nations, particularly the Middle East,” the article states. Even before the recent price plunge Chavez was considering a bidding round because the country’s production decline could not be reversed, even with the help of national oil companies from countries like Iran, China, and Belarus. While these companies have also been invited to bid, analysts say the large international companies have an advantage because of their expertise in building complex projects. Chavez’s socialist agenda relied on Venezuelan production to support both the state-owned oil company Petroleos de Venezuela and his social programs. If proceeds continue to drop, his popular support is likely to follow, the article states. Of course, given the turn-around time on some of these projects, this could also work to his advantage. The article states that he’s planning a referendum that would allow him to run for indefinite reelection.
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2024-03-01 - Amati Royalties has retained EnergyNet for the sale of a Powder River Basin opportunity with four wells and two pending wells in Campbell County, Wyoming.
2024-03-01 - TotalEnergies bought out its joint venture partner to become the sole shareholder in cleantech venture Ecoslops Provence.
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2024-01-02 - Civitas Resources’ acquisition of the Permian Basin’s Vencer Energy will account for half of Civitas’ total production.