Explosions, anarchy and mercenaries in the new PDVSA
<a href=www.vheadline.com>Venezuela's Electronic News Posted: Monday, April 28, 2003 By: Gustavo Coronel
VHeadline.com commentarist Gustavo Coronel writes: An explosion in the Jose Petrochemical complex in eastern Venezuela produced several deaths and injured ... as a result, the MTBE plant which supplies the US market is totally and indefinitely paralyzed.
Another explosion at the Amuay refinery, in western Venezuela, has paralyzed the operations at this refinery for one week.
Oil spills in the "new" PDVSA are 50 times the number of oil spills taking place before the December strike.
The government is no longer talking about sabotage since it is increasingly obvious that the accidents and damage suffered to PDVSA plants and equipment of are the result of the incompetence of the improvised staff.
After more than 18,000 managers and technicians were fired over the radio and their names published, like criminals, in newspaper lists, the doors of PDVSA were opened, to let "revolutionary" workers replace the professional staff.
It's truly a miracle that no more accidents have taken place since ideological affinities are, today, the main and only requisites to get a "technical" or "managerial" job in the "new" PDVSA.
This was to be expected in a company which has a former terrorist, the so called 'Comandante Fausto,' aka Ali Rodriguez Araque as its president.
In parallel with these accidents there's increasing anarchy within the organization. The Marketing Division, in charge of selling oil and products internationally, is in the hands of a group of youngsters of doubtful transparency and great indiscipline. They are in open rebellion against the new manager, Nelson Reyes ... a retired employee pressed back into service, who lacks the required "revolutionary" credentials. Although Reyes was not involved in the strike, he does not have the trust of the radicals in the organization.
In the production division in eastern Venezuela there's organizational chaos due to the removal of Gilberto Zerpa, an engineer with great popularity among his colleagues. Zerpa was named in his job by President Chavez but, a few days ago, Chavez himself fired him.
A company in which the President of the country employs and dismisses middle managers is bound to become a Mickey Mouse company in the short term. In fact, this short term is already here. The technical staff in eastern Venezuela are now up in arms (figuratively) against Chavez. As would be expected, PDVSA has been severely downgraded by the international community ... not so much due to the strike, but to the dismal performance of the new management and technical team.
While the "new" PDVSA is starting to rot from within, some international companies are sending mercenaries to do jobs for a company which is no longer the company they were doing business with.
- They know very well what is happening in PDVSA ... they know that the company is being dismantled and systematically destroyed in the name of a vague and undefined "revolution."
- They know that the corporate values they share are rapidly being disposed with in the "new" PDVSA.
- They know that the top officers of this PDVSA are the same persons that during the 1960´s were blowing up their installations all over the country. They know....
And yet, they're sending their people to help a crime to be committed ... they're not doing this because they need the money. They're too big and powerful for that!
They do not have any contractual obligations to do that because Technological Agreements signed by PDVSA with these companies in 1976 are no longer valid ... they faded away many years ago when INTEVEP, PDVSA's research company came into being.
What are they looking for?
Positioning, of course. But I say: What positioning will you have in two or three year's time, when a new government is in place and when PDVSA is back in the hands of its true managers? Positioning is a medium- to long-term proposition. but if you are betting on Chavez to be here until 2021 (as he claims), I can tell you that the odds are very much against you.
I recommend that you read Venezuelan history. If you do, you'll see that nationalization of the petroleum industry in our country was accelerated because of resentment created among democratic political leaders because of the cozy relationship some of you guys had with the Dictator Perez Jimenez.
The success of international oil companies in host countries has much to do with the empathy these companies develop with the country, rather than with the governments. If you bet on political horses rather than interpreting correctly the real mood of the country you are not going to be well positioned.
But, who am I to tell you this?
I am just an old petroleum hand while, surely, you have the technology, the know-how, the financial clout, the organizational might to be successful in any country ... be it Angola, Chad or Venezuela.
I just might mention that maximum benefits are usually less desirable than optimum benefits and that, after all, the heart of a big corporation ultimately has to be in the right place if it wants to come out on top.
You think Chavez is going to hand over the petroleum industry to you. There's no doubt that international petroleum companies should play an important role in the development and successful management of our oil resources ... I've always been in favor of an aggressive "aperture" (opening up) of our oil industry to private investment ... but this is not the way to do it.
It can not and should not be done by taking advantage of the political destruction of the real company by the lame duck and rogue government that is now offering you an opening.
Faust sold his soul to the devil and paid for all eternity.
Are you going to do business with this Commander Faust, who is at the threshold of political oblivion?
GIMME ME A BREAK...
Gustavo Coronel is the founder and president of Agrupacion Pro Calidad de Vida (The Pro-Quality of Life Alliance), a Caracas-based organization devoted to fighting corruption and the promotion of civic education in Latin America, primarily Venezuela. A member of the first board of directors (1975-1979) of Petroleos de Venezuela (PDVSA), following nationalization of Venezuela's oil industry, Coronel has worked in the oil industry for 28 years in the United States, Holland, Indonesia, Algiers and in Venezuela. He is a Distinguished alumnus of the University of Tulsa (USA) where he was a Trustee from 1987 to 1999. Coronel led the Hydrocarbons Division of the Inter-American Development Bank (IADB) in Washington DC for 5 years. The author of three books and many articles on Venezuela ("Curbing Corruption in Venezuela." Journal of Democracy, Vol. 7, No. 3, July, 1996, pp. 157-163), he is a fellow of Harvard University and a member of the Harvard faculty from 1981 to 1983. In 1998, he was presidential election campaign manager for Henrique Salas Romer and now lives in retirement on the Caribbean island of Margarita where he runs a leading Hotel-Resort. You may contact Gustavo Coronel at email gustavo@vheadline.com
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