PDVSA workers oppose takeover of PDVSA by Chávez

ogj.pennnet.com Sam Fletcher OGJ Senior Writer

HOUSTON, Jan.10 -- A panel of former executive and technical employees of Petroleos de Venezuela SA (PDVSA) said Friday they are struggling to prevent Venezuelan President Hugo Chávez from taking over the state-owned oil company to "gain control of Venezuela's economy."

PDVSA generates more than 50% of the revenue received by the Venezuelan government and accounts for 20% of the Venezuela's gross national product, said Luis Pacheco, an engineer and planning director at PDVSA before being named president of PDVSA's US operations late last year (OGJ Online, Sept. 23, 2002).

In a US telephone conference call Friday, he and other former PDVSA officials claimed Chávez's administration faces a severe financial crunch over the next few months as the cash flow from foreign sales of Venezuelan oil and petroleum products dries up.

PDVSA's oil production has fallen to 340,000 b/d from 3.2 million b/d since the Dec. 2 start of a general strike in that country, aimed at forcing Chávez from power.

"Half of that is produced by third-party licensees and half by our own effort," said another panel member who was among some 800 PDVSA employees fired for participating in the strike. PDVSA workers still on the job also are producing 880 MMcfd of natural gas to supply electric power generators in Venzuela, but the company's refining and petrochemical operations remain virtually paralyzed, panel members said.

They disputed claims by Chávez and members of his administration that PDVSA will return to full production within 30-45 days.

It would take at least 2 months for PDVSA to regain 50% of its November production level and 3 months to reach 90%, based on the "fundamental premise of the right people (remaining) in the right places, and that we can restore the normality of our situation," panel members said.

Ciro Izarra, former manager of downstream international commerce for PDVSA, said "all but one" of the company's refineries are closed, while the domestic "distribution system for gasoline and diesel has virtually collapsed." Recovery of PDVSA's refining operations "depends on experienced people," he said. "With no (interim) maintenance, it could take awhile to restore."

Cut off from access to PDVSA facilities, panel members could not say if Chávez has succeeded in recruiting foreign specialists to replace any PDVSA workers, nor could they confirm reports of increased accidents at PDVSA facilities.

However, one said, "I'm sure the number of incidents has increased 1,000% in the last month" as the government has brought in unskilled workers and military personnel to reactivate PDVSA facilities.

However, Petroleumworld.com published on the internet a photograph of smoke billowing from a 130,000 b/d, reportedly resulting from damage to a seal in a vacuum unit as unskilled workers tried to bring that unit on stream. It also reported Rafael Ramirez, Venezuela's energy minister, denied claims by dissident workers that 31 accidents had occurred in the past 6 weeks as a result of operational failures.

Petroleumworld.com said local television stations reported 13 oil spills at Lake Maracaibo in Western Venezuela as unskilled workers tried to increase oil production.

Meanwhile, the panel of former PDVSA employees said there is no merit to new government plans to split the state oil company into two operational divisions, one controlling oil and gas activities in the eastern part of Venezuela and the other handling operations in the western part of the country.

"It's a back-of-the-envelope plan for political expediency. There's no rationale whatsoever for such a move," Pacheco said.

Since his election as president of Venezuela in 1998, Chávez has focused attacks on PDVSA and its employees, Pacheco said. As a result, he said, five boards of directors and six company presidents have rotated through PDVSA executive offices in the last few years.

Pushed to "a breaking point" in April 2002 when Chávez attempted to replace the company's professional executives with political allies, PDVSA employees "took to the streets," where they were joined by other opponents.

Chávez briefly was ousted as a result and promised on his return to office to work with PDVSA executives in the future.

Pacheco and other panel members said they are willing to abide by any democratic decision reflecting the will of Venezuelans in the current crisis. But they rejected a suggestion that other South American countries might align with the Chávez administration to press for an end to the strike.

"This is an internal issue to be decided by Venezuelans," Pacheco said.

Contact Sam Fletcher at samf@ogjonline.com