dissident,

I worked in Norway for 6 years. Contracts are signed, bills are paid, no equipment is stolen by the state and everybody is happy.
Norway wouldn't even have an oil industry today if not for foreign service companies in the early days.
Now Statoil is one of the biggest oil companies in the world and their offshore workers have the best conditions in the world. I'd say Norway did a good job.
What the hell does Norway have to do with Venezuela?

americandream,

Geez, talk about a strawman arguement. Why the hell does a service co., who never deals with anything to do with royalties etc., usually just working on a day rate basis and employing locals at well above local pay scales, deserve not to be paid and then have their equipment stolen?
Even most communists pay their bills and don't steal the equipment you bring into their country.

What a pair of wingnuts.

Its one thing to pay someone for a service, its another to let them have your profits.

Chavez wants service companies to extract his oil at a fee. He does not want to see them cart off the countries business revenue, with a measley 1% tip. Thats the sort of thing that corrupt juntas wth bank accounts in Switzerland do.

To add insult to injury, what little tax these companies fall liable to is invariably exited out the tax net via a plethora of conduits and other transfer mechanisms, back to the over-fed land of "the have and continue to eat too much" folks.

I'm not surprised that you're annoyed seeing as it's likely to impinge on your dietary habits but see this as a service to your heart.

btw: These companies tend to behave in Norway because the Norwegians and Europe generally have good established business practices. Latin America on the other hand has long been America's backyard with corrupt Generalismos to do your bidding. Hopefully, the business relationship will mature, the Latins will get a fair deal, their peoples will fare better and you will have fewer refugees at your borders. Hey, and everyones happy.

I mean your attitude Maddog is similar to the local mower man wanting the deeds to my house after he's mowed my lawn. Why? Because I don't have a mower as high tech as his and my lawns are not as well maintained as he would like. I mean c'mon man! Be reasonable.

Like Blacksmith said, you don't seem to understand the difference between an oil company and an oil service company. Service companies only provide a service and expect to be paid for it. They do not receive oil or anything else. They just provide a service. H & P is a small drilling contractor based in Tulsa, OK. Not a large multi-national by any means. They signed a valid contract and moved their rigs into the country to drill wells. They not only didn't get paid but they've had their rigs stolen. How does this have anything to do with what you posted? This has also happened to other small service companies.

I'll put it in your lawnmower man terms.

I hire you to mow my lawn. When you're done not only do I not pay you but I steal your lawn mower, your gas can, the trailer and truck you hauled it on and kick you off of my property.
I then cry a month later cause no one will come and mow my lawn.
Sounds reasonable? Maybe to you and Chavez.

Is it any wonder you get a none too friendly reception going by the way you have done business in the past and your unreasonable expectations as a MERE PROVIDER OF A SERVICE.

Since when did a service provider have the right to bad mouth a client's badly kept lawn grounds to the client rather than advise him. Since when did a service provider have a right to his client's income stream over and above his service fees. Since when did a service provider have the right to demand that his client vacate his propety for a client more sympathetic to the service providers profit expectations. Since when did a service provider have the right to go round the neighbourhood bad mouthing his client. Since when did a service provider have the right to demand anything other than his entitlements as a service provider under a contract of service.

Since the day the mower man took to strong arming his clients, thats when. No wonder no one trusts him apart from those he has successfully intimidated or bribed.

btw: Irrespective of what I'm doing on your property. Whether it be mowing or drilling a water bore. I am providing a service. I may have leased the right to drill on your land, in which case I have an entitlement under that lease. The first may provide a service fee. The latter an income stream subject to royalty.

In both instances however, there has been gross abuse of the entitlements of the foreign entity. In the first case, the unreasonable expectation that they can secure a portion of the landowners income, usually by cooking the books in mismanaged banana republics. In the second case, unfair royalty agreements with generalissimos and tax practices to exit the last drop of profit.

Greed undone them.

I tried to explain that the service company in question did none of the things you mentioned nor was ever even in that position. They are not an oil company. They don't lease land. They don't hold any rights at all. They were contracted to the state oil company. They have nothing to do with the oil in the ground. There is no income stream. Now it's guilt by association. Why can't you seem to get that? You are lumping two completely different types of businesses together.
It doesn't matter, Chavez is paying the price now and will pay an even bigger one in the future.
Nobody will be willing to help him increase output until the money is wired into the bank first.
Whether the world wants his oil or not his oil company can't get it out without help from foreign oil service companies. Even if he wants to form his own oil service companies they will have to buy equipment internationally in order to operate and the equipment builders will want cash in advance knowing how he operates. His slumping production is proof of that.

There's no point me even continuing this with someone who is a rabid communist and actually not even a communist because like I said before even communists pay their bills.
You think just like a common thief actually. I'd hate to be your lawnmower man.

Any foreign business that DOES NOT seal any profit leakage and repatriate as much of its profits out of the third world to its western parent by all and every means is either too small to be of any consequence, run by idiots whom the share holders will quickly jettison or is, frankly, telling a bunch of lies.

As for Chavez, whats a bet he will find someone to do his business. There are no ethics, morality or loyalties when it comes to the bottom line. Money is money. If you can't get it by shafting the poor sod, then you do it by being nice to him. Human nature 101 pal.

If you get the chance, try and spend some time sitting in on business meetings at the big accounting firms. You'll quickly lose your innocence.

Like I said if he wires the money first, people will do business with him.
That would be considered being nice to someone.

In your case, I would guess you have to pay your lawnmower man first before he will come to your house. You've probably burned him too many times for it to be otherwise.

Give them an inch and they will take a mile. Oil extraction maximization is something that works in favour of consumer nations and not the producers. It's hilarious for the beneficiaries of massive theft of Venezuelan oil wealth (through transfer pricing via Citgo, for example) to now be harping about inefficiencies of government intervention in the oil industry. As far as the average Venezuelan is concerned the money is flowing to Venezuela and providing services that Canadians and whatnot take for granted (and then chirp like they prefer the third world toilet model of laissez faire). It matters not a rat's *ss that some foreign malcontent is pulling performance metrics out of their *ss to justify an anti-Venezuelan campaign. Congress is trying to put Venezuela on the list of state sponsors of terrorism right now. This is the lunatic context for the smear campaign.

Here's a man who knows what he's talking about.

I personally can't see the point in looting someone to the point that they're destitute and knocking at your door for to be let in. Just don't make sense to me but then again, I'm sensible.

Me too. Agree fully here. I really like Chavez. Plus, he ain't no stinkin' liberal. No stupid wars have been started by this brave and heroic ex-soldier.

Most international oil companies withdrew from Venezuela when Chavez PARTIALLY nationalized the oil fields. Some, however, chosed to stay like Norwegian Statoil. All oil companies pays 78 percent tax on the profit in Norway. No other royalty or fee, no paying for licenses, simply pays 78% of the profit in tax. Where in the third world does any international oil company pay anything resembling these 78 percent in tax? Nowhere! Statoil chosed to stay because they found it reasonably to pay most of the profits in tax. The international oil companiec didn't find it reasonably to pay most of the profits in tax. Therefore they left.

This is the reason for Chavez to nationalize the oil fields, Venezuela didnt get it's fair share of the profit, the international oil companies simply had been too greedy for too long time.

These stupid people starve the Latins into poverty and then wonder why they throng the border as ilegal immigrants. Want to solve illegal immigration. Pay the going rate and let them rule themselves as they see fit.

Seems like Chevron has no problem with doing business there.
Hot off the presses.

http://www.rigzone.com/news/article.asp?a_id=82109





I spoke with my contact over at H&P today.
Apparently PdVSA paid the $100 million they owed and no rigs are being seized so everybody is happy.
Like I said earlier I hadn't kept up with the story.
I also found out H&P is bigger than I thought. They have a fleet of over 200 rigs and they had 11 in Venezuela at the time of the incident.
There was apparently some other "behind the scenes" stuff going on but I won't bother repeating it here.

Don't you just love a story with a happy ending?