Venezuela lifts force majeure for some light oil

www.alertnet.org 24 Feb 2003 20:51

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CARACAS, Venezuela, Feb 24 (Reuters) - Venezuela has lifted a force majeure for exports of some lighter grades of its crude as the government struggles to restore oil operations in the strike-hit country, energy minister Rafael Ramirez told Reuters on Monday.

"Some force majeures with some specific crudes have been lifted," Ramirez said.

Venezuela, normally the world's No. 5 crude exporter, declared force majeure on oil and product exports during the first week of a strike by foes of President Hugo Chavez. The strike started on Dec. 2.

Force majeure is invoked when a company cannot meet its contractual obligations.

The minister did not specify what type of crude oils were no longer under a force majeure, but a source with state oil firm Petroleos de Venezuela (PDVSA) said the lifting of the declaration was for light crudes from the nation's eastern region.

"Its production from the eastern side, crudes like Mesa and Santa Barbara," the PDVSA source told Reuters.

Crude production from the east has been restored to close to prestrike levels, while older oil fields from the west take longer to return.

The OPEC nation, which normally supplies more than 13 percent of U.S. crude imports, had been shipping nearly 2.7 million bpd of oil and products before the stoppage disrupted oil operations. Oil exports provide half of government revenues.

PDVSA has fired more than 12,000 oil employees that joined the strike, and is using replacement workers and the military to help restart the industry. PDVSA President Ali Rodriguez said on Sunday that oil production had been restored to just more than 2 million bpd, and that nearly 500,000 bpd more were to be brought back on this week.

Dissident PDVSA employees have said output has reached just 1.5 million bpd, compared with more than 3.1 million bpd before the strike.