Its red shirts fading, Venezuela's oil giant embraces pragmatism

[hack89]

Source: Reuters

For years, PDVSA employees were encouraged to wear red shirts in support of late President Hugo Chavez's socialist movement. Rafael Ramirez, the former oil czar famously vowed the state-owned firm would be "redder than red" and sent workers to state rallies. Over the past few months, however, the company's new management - led by president Eulogio del Pino, a low-profile Stanford-educated engineer - has eased up on revolutionary garb and attendance at militant gatherings, according to sources within and outside the company.

The sartorial shift symbolizes the new management's effort to regain focus at a firm that has become a haven for political friends and operatives, according to people familiar with the strategy.

It marks a sharp pivot after a decade under the helm of Ramirez as shoring up the nation's main cash cow trumps ideology in the face of the collapse in global crude prices.

The changes go well beyond the symbolic: PDVSA is granting its minority partners more financial and operational sway in joint ventures, according to sources close to the company. A dozen of those foreign oil companies are also poised to tap the most favorable exchange rate of Venezuela's complex three-tiered currency system.

Read more: http://www.reuters.com/article/2015/03/13/us-venezuela-oil-insight-idUSKBN0M90AW20150313

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Smart move on their part. They need foreign capital and expertise to maximize their oil revenue.

[brooklynite]

1. "sent workers to state rallies..."

I seem to recall that people here were miffed when business owners required employees to attend Mitt Romney rallies. But maybe it's only wrong if it's a policy you don't like?

[christx30]

2. It's a different country,

where the State takes more of an active role in their lives. There was a story a few years ago where Chavez was interrupting ALL broadcasting to do weekly nationwide speeches. No one here really had a problem with forcing everyone to sacrifice an hour or two per week to listen to their Great Leader. The attitude made me sick.

[COLGATE4]

3. Here's the money shot

"The strong pressure on PDVSA to generate resources is increasing," said Richard Obuchi, local economist and energy specialist. "Actually, I think it would almost be a big success if they managed to maintain current production levels."

[fasttense]

4. Whittling away socialism and replacing it with capitalist interference. Not a smart move.

Oh come on, does Reuters, or anyone currently ripping into Venezuela, really think Venezuela is going to get a good deal out of foreign oil corporations involvement? When have big corporations actually helped anyone besides themselves especially when profit is involved? And when has foreign capital been so helpful? Greece? Austerity? Brazil? Germany before WWII? BP in the Gulf?

When the bushes had the pentagon, government workers and contractors marching in the streets for his illegitimate wars, I didn't notice Reuters getting all upset about it. When Mitten's friends and CEOs forced their employees to support the fool, we didn't hear a peep from Reuters saying how awful it was. But they seem to have their panties in a twist about Venezuela doing the same thing.

[hack89]

5. Venezuela does not have the resources to develop their oil fields by themselves

they have no real choice. Their oil is some of thickest and difficult to pump as any in the world - on par with Canadian tar shale oil. It technically difficult and capital intensive.

It can't get any worse than it is right now - their oil production has been steadily falling for over a decade.

[christx30]

6. But no one is going to

risk it. Venezuela has a history of stealing equipment and going back on their contracts.
As long as the current thieves and idiots are in charge, no one is going to help them. Their production will continue to drop and the people are going to continue to suffer.

[PersonNumber503602]

7. What prevents them from hiring individual expertise that can help VZ develop its

own technical ability to extract the oil? I understand that companies that already have the technical resources and experience can do it easier and cheaper, but what can Shell's or Exxon's money buy that VZ's money can't? Is there a shortage of people with the required level of of skill out there?

[hack89]

8. Venezula doesn't have the money to that

the present economic crisis has at its root the lack of foreign reserves. The lack of dollars to import goods and materials is why they are suffering shortages of food, medicine and other necessities. And their credit rating is such that they can't borrow the money. So joint ventures are the only option they have.

[PersonNumber503602]

9. Ahh, that makes sense. I wasn't aware that they were in that bad of shape.

Although, that seems like something that should make a national priority.