Page 11 - LatAmOil Week 16 2020

LatAmOil VENEZUELA LatAmOil
 According to the Treasury Department’s Office of Foreign Assets Control (OFAC), the company no longer has permission to drill wells in Ven- ezuela or to buy, sell or transport crude oil or petroleum products there.
The government’s decision will also affect four of the world’s biggest oilfield service provid- ers: Baker Hughes, Halliburton, Schlumberger and Weatherford International, all of which are based in the US.
These companies have been operating in Venezuela under waivers similar to the one granted to Chevron, but they too must prepare to leave by December 1.
Chevron has acknowledged the US govern- ment’s instructions. In a statement, the company said it was committed to following all relevant
Petropiar is one of Chevron’s JVs with PdVSA (Photo: PdVSA)
US laws and regulations. It also explained the parameters of OFAC’s instructions, saying: “The US Department of Treasury renewed General Licence 8 and permits the company to under- take limited maintenance of essential operations in the country.”
Washington has supported claims by Ven- ezuelan opposition leader Juan Guaido that Maduro used fraudulent means to win re-elec- tion in late 2018. Guaido was named interim president more than a year ago but has not been able to secure Maduro’s departure from power. His allies have secured control over the US-based refiner Citgo, which is one of the most valuable assets owned by the national oil com- pany (NOC) PdVSA, but Maduro still holds PdVSA. ™
Venezuelan opposition looks askance at “shadow tax” on JVs
VENEZUELA’S National Assembly is consider- ing proposals for revising joint venture contracts to make the country’s oil sector more attractive to foreign investors, Reuters reported earlier this week.
Sources with knowledge of the matter told the news agency that members of the assembly’s energy committee had discussed the proposed revisions at a meeting last week. They indicated that they were willing to eliminate a “shadow tax” – that, is a standard condition in contracts that reserved at least 50% of all revenues from joint ventures between the national oil com- pany (NOC) and foreign investors for the Ven- ezuelan government.
This feature has drawn criticism because it
serves to direct a larger share of overall reve- nues from such ventures to Caracas whenever crude oil prices fall (as they have done in recent months). This makes it unattractive to outside investors, explained one of Reuters’ sources. “The inconvenience of the shadow tax is that it is regressive,” he added.
The news agency said it had viewed docu- ments outlining the new policy proposal. Citing the documents, it said the legislators hoped to eliminate the requirement that PdVSA’s foreign partners pay Caracas “the difference, if there is one, between 50% of the value of the hydrocar- bons extracted ... and the sum of all payments made by the joint venture to the Bolivarian Republic of Venezuela.”
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