Chavez opponent to seek more private investment in oil

Caracas (Platts)--22Nov2006

Manuel Rosales, the main candidate to face Venezuelan President Hugo
Chavez in presidential elections on December 3, said on Tuesday that, if
elected, he will seek more private sector investment in Venezuela's oil
industry.
"I'm going to clear up all of the conditions of respect and trust so that
national and foreign investors invest in Venezuela," Rosales said after a
press conference with foreign media. "No society advances or modernizes
without an alliance with the private sector."
The Chavez government has made life difficult for private companies,
compared to a period in the 1990s when Venezuela opened up its industry to
foreign companies. Chavez has demanded that private companies operating in
Venezuela modify their contracts to give the state majority participation in
new joint ventures.
The government has also invited eleven non-traditional companies, mostly
state-run companies from politically-allied countries, to study blocks in the
Orinoco heavy oil belt, while it has not yet accepted proposals from large
foreign companies like Shell and Chevron for new projects in that area.
Rosales called the dismantling of the 1990s ?apertura,? or ?opening? of
the industry, "a step backwards for Venezuela."
Most polls put Rosales some 20 percentage points behind Chavez, although
one recent poll by US company Penn, Schoen & Berland associates determined
Chavez was only leading by 6 points.
Teodoro Petkoff, a campaign strategist for Rosales who is also the editor
of the Venezuelan newspaper Tal Cual, said Venezuelan state oil company ?needs
an overhaul.? He said the company needs to recuperate valuable personnel it
lost when the government fired over 18,000 workers during an opposition-led
strike to oust Chavez in late 2002 and early 2003.
"PDVSA was a company of the first category, and now it?s a marginal
company," Petkoff said.
Helindoro Quintero, oil advisor and campaign coordinator for Rosales, told
Caracas daily El Universal in a report published Wednesday that Rosales would
conduct a "massive exploration plan" to significantly raise crude production
in Venezuela.
The Energy Ministry says Venezuela is producing 3.3 million b/d, while
secondary sources put that figure around 2.6 million b/d. The government has
promised to raise to production to over 5 million b/d by 2012.

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