VENEZUELA: Total and BP strike a deal with Venezuelan government over seized oil field

Record ID: 343500

  • Title: VENEZUELA: Total and BP strike a deal with Venezuelan government over seized oil field
  • Date: 6th March 2007
  • Summary: (W5) CARACAS, VENEZUELA (MARCH 05, 2007) (REUTERS) START OF THE CEREMONY MEDIA AT CEREMONY VENEZUELAN ENERGY MINISTER, RAFAEL RAMIREZ, SIGNING THE AGREEMENT MEDIA PRESIDENT OF BRITISH PETROLEUM VENEZUELA, JOE PEREZ, SIGNING THE AGREEMENT MEDIA DIRECTOR OF PETROLEOS DE VENEZUELA S.A., VENEZUELA'S STATE OIL COMPANY AND THE PRESIDENT OF THE VENEZUELAN PETROLEUM CORPORATION,
  • Embargoed: 21st March 2007 12:00
  • Keywords:
  • Topics: Industry
  • Reuters ID: LVA7XOXEKCYSXIJ2WNYS9JS80X8D
  • Story Text: Oil majors Total and BP have struck a deal with Venezuelan state oil company PDVSA over the Jusepin oil field which the South American state seized from them in April 2006. Venezuela will pay oil giants Total and BP $250 million for the Jusepin oil field it seized from them in April last year.
    This news was made public as Total and BP representatives attended a ceremony in the Venezuelan capital on Monday (March 05).
    Joe Perez, President of BP Venezuela and Christophe de Margerie, President of Total signed the agreement with Venezuelan state oil company PDVSA.
    The Jusepin field produced about 30,000 barrels per day when it was taken over. BP was the minority partner in operations.
    Venezuela seized the field after the foreign companies failed to agree to terms under which the field would be operated as a "mixed company" with the Venezuelan state holding a majority stake.
    Total's Christophe de Margerie adopted a conciliatory tone at Monday's meeting.
    "Times change for sure. Contexts change and situations change. What remains certain in the case of Total is its willingness to remain in Venezuela for a long time. I can say to you that this is Total's strong desire," he said.
    Venezuelan President Hugo Chavez is pushing ahead with a raft of nationalisations, particularly in the energy sector. He is using the bumper oil windfall of the OPEC nation to pay companies targeted in nationalizations.
    Rafael Ramirez, the Venezuelan Energy Minister spoke of the deal in the Jusepin case.
    "Having had a process of frank technical and economic discussions, having taken the first step that this affair will not go to any tribunal, will not undergo any arbitration, today we have been signing the documents to wrap up the pending matters surrounding the Jusepín affair. After everything (that has happened), it was a discussion that was perfectly supported. We have arrived at an arrangement that $250 million will be used to settle the Jusepín affair and all parties are satisfied with this agreement."
    Monday's deal comes against the backdrop of tough negotiations between the oil majors and Chavez over multibillion projects in the country's vast Orinoco reserve of heavy crude.
    Chavez has decreed the state will take a majority stake in four foreign-run operations by May 1, although he has given the companies, which also include Exxon Mobil Corp., Chevron Corp., ConocoPhillips and Norway's Statoil ASA, several additional months to reach the terms of an overall agreement.
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