Venezuela nationalises foreign oil rigs
Web posted at: 5/15/2007 4:9:7
Source ::: AFP

CARACAS • The Venezuelan government of firebrand President Hugo Chavez said yesterday it was taking control of oil rigs from multinational firms, in the latest of a wave of nationalisations.

Energy Minister Rafael Ramirez, who also heads the state-owned energy company PDVSA, said the firm had in the past ceded control of 18 offshore drilling platforms to foreign giants.

"These companies demand millions for the use of these machines. Faced with this situation, we have decided to nationalise this equipment," he told the official Venezuelan news agency ABN without elaborating.

Oil services firms present in Venezuela include US giants such as Halliburton, Baker Hughes and Schlumberger. At the start of his second six-year term in January, the leftist Chavez decided to nationalise "strategic" interests in sectors such as energy, telecommunications and power generation.

Chavez, whose government is flush with cash from booming oil prices, has been a repeated thorn in the side of the United States, which buys about half of Venezuela's daily crude production of three million barrels.

PDVSA is diversifying its supply of drilling machines used in oil exploration, and Ramirez said the first of a new batch from China would arrive in November. "The idea is to acquire 13 machines, with one arriving each month," the energy minister said.

"In parallel to this agreement, Venezuela will install an assembly plant for drilling machines and in a second stage, the objective will be to make these machines directly in the country," he said.

Meanwhile, President George W Bush rolled out yesterday plans to slash US reliance on oil supplied from unstable regions and so boost the energy-hungry country's defences against extremist attack.

The directive to cut gasoline usage by 20 per cent in the next 10 years will make the United States "more secure for generations to come," help economic growth and safeguard the environment, Bush said.

The so-called "20 in 10" plan was first laid out in Bush's State of the Union speech in January, seeking to slash US oil imports from the restive Middle East and make US energy supply less vulnerable to terrorism.

The president presented legislative proposals for Congress and ordered regulatory action from his cabinet members in charge of transportation, energy, agriculture and the Environmental Protection Agency (EPA) by end-2008. "Our dependence on oil creates a risk for our economy because a supply disruption anywhere in the world could drive up American gas (gasoline) prices to even more painful levels," he said in the White House Rose Garden.

"Our dependence on oil creates a threat to America's national security because it leaves us more vulnerable to hostile regimes and to terrorists who could attack oil infrastructure.

"For all these reasons, America has a clear national interest in reducing our dependence on oil."

Bush urged Congress to pass legislation setting fuel economy standards that would result in quintupling the current consumption of renewable and alternative fuels to 35 billion gallons (133 billion liters) by 2017.

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