Historically, Venezuela has nationalized its hydrocarbon industry in 1975-1976, creating Petroleos de Venezuela S.A (PdVSA), the country’s state-run oil and natural gas company. Along with being Venezuela‘s largest employer, PdVSA accounts for about one-third of the country’s GDP, 50 percent of the government’s revenue and 80 percent of Venezuela’s exports earnings. The policy changed in the 1990s, when Venezuela has liberalized partially its oil industry in introducing a new oil policy known as Apertura Petrolera, which opened its upstream oil sector to private investments. This facilitated the creation of 32 operating service agreements with 22 separate foreign oil companies, including international oil majors like Chevron, BP, Total, and Repsol-YPF. In 1999, Venezuela adopted the Gas Hydrocarbons Law, which opened all aspects of the sector to private investment. This policy changed after Hugo Chavez took the presidential post in 1999. In recent years the Venezuelan government has reduced PdVSA’s previous autonomy and amended the rules regulating the country’s hydrocarbons sector. In 2001, Venezuela passed a new Hydrocarbons Law that superseded the previous 1943 Hydrocarbons Law and 1975 Nationalization Law. Under the 2001 law, royalties paid by private companies increased from 1-17% to 20-30%. Venezuela started to strictly adhere to OPEC production quotas. In 2007, Chavez announced the nationalization of the oil industry. The foreign oil companies were forced to sign agreements giving majority control of hydrocarbons projects to PdVSA. Projects owned by US companies like ConocoPhillips and ExxonMobil, who failed to sign these agreements, were taken over by PdVSA. > Continue.
Publications: Covalence Analyst Papers | Country: Venezuela | Company: Petroleos de Venezuela S.A | Source: Loic Gaillard