Chavez seizes oil service companies

The revolución in Venezuela follow a predictable path, as Hugo Chavez starts seizing assets of oil field service companies in Venezuela, the day after the National Assembly passed a law enabling this. Matthew Walter and Daniel Cancel of Bloomberg report that the assets of 60 companies have been seized, including units of the Williams Cos. of Tulsa.

"Today, the private services companies disappear, we don't need them, the people and workers can do the labor and be more efficient," Chavez said. "We're going to bury capitalism in Venezuela."

Ever since oil prices fell, Venezuela has been having trouble paying its bills to the companies who keep its oil wells pumping efficiently. Venezuelan oil is very heavy and difficult to work with. The amounts owed are, accordingly, large. Seizing them helps solve the accounts payable crisis. For awhile.

PDVSA owed service contractors $13.8 billion at the end of 2008, El Universal newspaper reported today, citing a year-end report sent to the country's national assembly.

Of course, without expert maintenance and access to state of the art technology, productivity falls. The people and the workers may not be enough. Don't leftists ever learn? Or don't they care?

Reuters reports:

The following are major service companies that operate in Venezuela:

* Schlumberger : The world's largest oil service company is also the principal provider of services in Venezuela including drilling, measurement and well services designed to boost output of operations.

Sources say PDVSA's debts with Schlumberger are the largest among the service companies operating in the country.

* Halliburton : A major player in Venezuela's oil services market, Halliburton provides products such as drilling fluids and a range of oil well services. PDVSA owes it hundreds of millions of dollars in debts.

Supporters of leftist Chavez have frequently insulted the company for its association with former U.S. Vice President Dick Cheney despite it being a key PDVSA contractor.

* Petrex: Owned by a division of Italy's Eni , Petrex operates around 30 land rigs throughout Venezuela, mostly concentrated in the eastern region.

* Baker Hughes : The world's third-largest oil services company, which provides a range of oil field and oil well services in Venezuela.

* San Antonio Internacional: A land-based driller with a heavy presence in Latin American oil operations and a key driller in Venezuela.

* Other contractors operating in Venezuela include Danish shipping and oil group A.P. Moller-Maersk , BJ Services and Weatherford International .

Hat tip: David Paulin
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