& Tobago

Very usefull links


News links




Dow Jones

Oil price



Views and News




Venezuela mulls privatizing oil on burning economic crisis

Venezuela Weighs Privatizing Oil in Face of Economic Free Fall

- Government held talks with Repsol, Eni and Rosneft on shares
- Proposal could reverse Chavez's nationalization policy

By Fabiola Zerpa, Lucia Kassai, and Ben Bartenstein / Bloomberg

Petroleumworld 01 28 2020

Facing economic collapse and painful sanctions, the socialist government of Venezuelan President Nicolas Maduro has proposed giving majority shares and control of its oil industry to big international corporations, a move that would forsake decades of state monopoly.

Maduro's representatives have held talks with Russia's Rosneft PJSC, Repsol SA of Spain and Italy's Eni SpA . The idea is to allow them to take over government-controlled oil properties and restructure some debt of state oil company Petroleos de Venezuela SA in exchange for assets, according to people with knowledge of the matter.

The proposal, which could offer a balm to the country's disintegrating oil industry, is in early stages and faces major obstacles. Venezuelan laws would have to be changed, there is disagreement over how to finance the operations, and Washington's sanctions bar any U.S. companies from doing business with the Maduro regime without a waiver. The sanctions have also discouraged non-U.S. firms from investing in Venezuela.

Once an admired state-dominated company producing 3.5 million barrels per day, PDVSA is pumping at a record-low of 700,000, despite sitting on the world's largest known reserves. Its finances are in tatters: The central bank's hard-currency reserves have plunged to the lowest in three decades while the government's cash holdings total less than $1 billion .

National Assembly

For the U.S. Treasury to change its policy would almost certainly require sign-off from opposition leader Juan Guaido, who is backed by Washington over Maduro and is the leader of the National Assembly, where laws are passed.

While Guaido and the opposition favor increasing foreign participation and investment in Venezuela, they don't want to do anything that would help Maduro survive. They are pushing for him to step down and permit new presidential elections.

Earlier this month, Maduro-backed troops kept Guaido out of the legislature while pro-government lawmakers selected a new head, Luis Parra. Guaido's supporters then voted Guaido back in at an off-site meeting, so leadership of the assembly remains in dispute . One reason Maduro sought the new legislative leader was to make it easier to enact the required change in law, according to people familiar with the situation.

PDVSA is asking the companies for new investments while they would, if the proposal goes forward, want to be paid from operational flow, two people said. The talks have raised the possibility of turning into equity some of PDVSA's debt to the companies, the people said.

PDVSA and Rosneft didn't respond to a request for comment. Repsol declined to comment, as did Eni and the U.S. Treasury.

Several U.S. contractors, including Chevron Corp. , have temporary licenses to operate in Venezuela. It is unclear what would happen to those licenses if the Maduro government were to proceed with this proposal.

Crown Jewel

Oil has long been Venezuela's crown jewel, a resource so precious that stringent restrictions on foreign ownership and involvement are laid out in the constitution.

But the country's crisis, a result of titanic mismanagement, plunging oil prices, corruption and foreign pressure, has caused Maduro to bend many socialist principles recently.

He has quietly ended currency and import controls, permitting the growth of a limited dollarized market economy. In a separate effort, he has also engaged in secret talks with holders of some $60 billion in bonds, some of them American, offering to pair them up with a foreign drilling company that would be granted the rights to oil fields as a means of their recouping debt, according to people familiar with the matter.

By Fabiola Zerpa, Lucia Kassai, and Ben Bartenstein from Bloomberg. 01 27


We invite you to join us as a sponsor.
Circulated Videos, Articles, Opinions and Reports which carry your name and brand are used to target Entrepreneurs through our site, promoting your organization’s services. The opportunity is to insert in our stories pages short attention-grabbing videos, or to publish your own feature stories.________________________

Copyright© 1999-2020 Petroleumworld or respective author or news agency. All rights reserved.

We welcome the use of Petroleumworld™ (PW) stories by anyone provided it mentions as the source.

Other stories you have to get authorization by its authors. Internet web links to are appreciated.

Petroleumworld welcomes your feedback and comments, share your thoughts on this article, your feedback is important to us!

We invite all our readers to share with us
their views and comments about this article.
Write to

By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to:

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8, 10 +/ 800x600 pixels

Twitter: @petroleumworld1




Editor & Publisher: Elio Ohep/
Contact Email:

CopyRight © 1999-2020, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2020, Petroleumworld   / Elio Ohep - All rights reserved

This site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.