Veneconomy: “Is Venezuela’s oil giant PDVSA on the brink of bankruptcy?
From the Editors of VenEconomy
If something proves to be inefficient, inefficacious, negligent, vision-lacking and highly corrupted by the revolutionary castro-communist regime members, that would be state-owned oil company Petróleos de Venezuela (PDVSA).
It is no longer about the destruction seen over the last 14 years sparked by disinvestment and lack of maintenance in PDVSA’s refining facilities. It is about the toll PDVSA is taking due to the strategic error of selling or abandoning its assets abroad that, one way or another, gave it a strong foothold in foreign countries and guaranteed the placing of the oil in the market.
This way, the “all-red” PDVSA at the helm of Oil Minister Rafael Ramírez, who happens to wear anti-imperialist eye shields around his head all the time, has sold (from 2006 to date) the following assets:
Two Citgo asphalt factories that operated in Savannah and Paulsboro, thus getting rid of some good low-quality crude processing business;
A stake in two pipelines across the American territory for the transport of crude oil at low costs;
A stake in four German refineries from Ruhr Oel;
A 41.25% stake at a Lyondell-Citgo Refining LP refinery in Houston, thus losing the right from that minority stake to place 110,000 barrels per day in that refinery. This week, LyondellBasell, now owner of a 100% stake in that refinery, said it will supply the refinery with heavy crude oil from Canada and will no longer buy oil from Venezuela.
On top of that, Bloomberg reported this week that Schlumberger Ltd., the world’s largest oilfield services company, will slow its pace in Venezuela due to behind payments by PDVSA. According to Bloomberg, a spokesperson for Canada-based investment bank RBC Capital Markets reported that the estimated debt with Schlumberger would be located between $565 million and $1.14 billion. And as if it were not enough, Bloomberg reported that total debt with PDVSA suppliers and contractors for 2011 reached $12.3 billion, something that, according to other sources, has risen now to $20 billion.
If this debt is added to PDVSA’s financial debt, which at the close of 2012 hit $40 billion, total debt would stand at $60 billion, thus representing 11 months of PDVSA exports. Not to mention the astronomical debt with China, with which the country has irresponsibly mortgaged a big chunk of future oil output.
Is this policy of destruction of the main source of income for Venezuela what these communist people want to perpetuate?
VenEconomy has been a leading provider of consultancy on financial, political and economic data in Venezuela since 1982.