blogs.salon.com By Miguel Octavio The Devil's Excrement

During the last week, there have been what people abroad consider to be positive news surrounding PDVSA activities, specially in believing taht the fiscal picture has improved dramatically. In particular, crude oil production has increased significantly from the beginning of the month. This has been done by emphasizing younger wells with natural flow, which require no injection. Moreover, these wells are mostly located in the Eastern part of the country, rather than in the more “militant” area of Zulia State where Lake Maracaibo is located. As of yesterday, production was up to 1.044 million barrels a day, of which 692 thousand comes from the East, only 269 thousand from the West and 92 from the South. The Western area has about two thirds of the capacity of the country, but they are mostly older wells.

            Gas compression on the other hand, has not increased as much, going from 2.7 billion cubic feet per day in early January to 3.9 billion cubic feet per day now. Total production is normally roughly 9.4 billion cubic feet per day. Where things have change little is in refining capacity. The Puerto La Cruz refinery remains at the same level as the beginning of the month with 75 thousand barrels a day out of a capacity of 120 thousand. Paraguana is barely producing 50 thousand out of a capacity of 800 thousand and El Palito is not producing, due to an accident that took place earlier in the month. Sources in PDVSA suggest that without the return of oil workers, it will be extremely difficult to increase oil production beyond 1.8 million barrels and the likely steady state level will be closer to 1.5 million barrels. Additionally, there is little maintenance going on in any of the areas of business.  To understand the implications of the numbers above better, it is interesting to consider what the “true” fiscal contribution of current or prospective oil production may be. Under normal circumstances, Venezuela consumes 230,000 barrels of gasoline a day, which given current conditions is down to roughly 100,000 barrels per day. Of these, only 20,000-30,000 is being produced locally at the Puerto La Cruz refinery, with the balance being imported. However, imported gasoline is purchased at international prices of roughly $38 per barrel and is being sold in the local market at a price of approximately $5 per barrel. Thus, the net 70,000 barrels that need to be imported are paid with the funds obtained from exporting 532,000 barrels of crude. This currently leaves less than 500,000 barrels that have a fiscal contribution. However, those that result from the production of the operating agreements, approximately 250,000 barrels a day, have a much lower contribution given the conditions under which this exploration tracts were sold. Essentially, the fiscal contribution of these exports is much less, since depreciation and amortization costs can be deducted directly from the fiscal contribution. Note that this calculation assumes the current level of gasoline consumption, so that any easing of the general strike, without PDVSA going back to work, actually goes against the Government, since gasoline consumption may actually increase dramatically. Thus, barely a quarter of a million barrels a day has a full fiscal contribution today.

            Looking into the future another 400,000 barrels of heavy crudes from the Orinoco Belt joint ventures could come on line, if the natural gas situation is normalized and workers could be found to replace those that refuse to go back to work. Once again, the fiscal contribution from these projects is smaller since they pay only a 1% royalty but they do have the usual tax contribution. Thus, any news on the oil front has to be interpreted with care. The country could quickly move up to 1.5 million barrels of production a day, without having a large impact in terms of fiscal contribution. It is only above 2 million barrels of oil a day that the fiscal constraint would ease, but such a level may not be reached in 2003 if maintenance efforts are not sustained.

www.vheadline.com Posted: Friday, January 31, 2003 - 12:06:34 PM By: Gustavo Coronel

VHeadline.com commentarist Gustavo Coronel writes: The first thing that made me feel proud about PDVSA was the manner in which it became a First World corporation surrounded, on all sides, by Third World government agencies.

What could be called an island of excellence.

It was living proof that Venezuelans could be as organized, as disciplined, as efficient as the Norwegians or the British or the Americans. It was living proof of the proposition that education, training and proper work ethics are not the monopoly of northern, protestant cultures and that progress and success are not only found in developed societies.

During the 1980s, PDVSA rapidly became one of the three or four most important energy corporations in the world ... and its management was 100% Venezuelan ... men and women of all colors, mostly 'mestizos' like the majority of our population. Some were pretty dark, like the marketing expert and board member Mario Rodriguez. Some started as minimum wage laborers ... like Alberto Quiros ... who became the first Venezuelan president of Shell, and still is our foremost petroleum expert.

Many were immigrants or sons of immigrants. But the whole management team was tightly united around four basic principles:

PDVSA was to be managed professionally, as a commercial enterprise.

PDVSA was to be apolitical.

PDVSA should finance itself, and

PDVSA should always plan well and execute well.

...and this is the way it was until 2000.

PDVSA grew from having 18 billion barrels of reserves to having 340 billion barrels of reserves (including the Orinoco heavy oil belt) in 1999. It went from a production capacity of 2.7 million barrels a day to 3.8 million barrels a day ... from one million barrels a day of refining capacity to over three million barrels per day with refineries in Venezuela, the Caribbean, North America and Europe.

In 1976 gross income was $9 billion and in 2000 $54 billion. Net earnings increased from $7 billion to $20 billion while the government share per barrel increased from $8 to $12 per barrel. Of these net earnings of $20 billion the government take is, I am told by the petroleum finance managers, $15 billion, this is, 79%. A major portion of the costs of PDVSA, some $19 billion, have to do with the buying in the open market of the oil they could be producing internally, if it was not for the OPEC quota limitation.

But the objective of the Chavez government was not to make the rest of the bureaucracy as disciplined and efficient as PDVSA's, but to make PDVSA as inefficient and as chaotic as the rest of the government sector. This was necessary, in order to have a society in which we would all be at the same level, not by upgrading the poor and the ignorant, but by downgrading the prosperous and the educated.

One of Chavez' claims was that petroleum managers earned too high a salary ... I have already documented the fact that PDVSA productivity per employee was the highest in the group of its large international competitors. No society can ever prosper by penalizing productivity.

• Of course, the 1.3 million government employees ... including Chavez ... earn mediocre salaries, and the net result is a very high degree of corruption, low productivity and an indifferent bureaucracy.

Today PDVSA is being destroyed systematically ... over 5,000 managers and technicians have been fired ... men and women who are impossible to replace except by foreign-hired guns. Operations are disastrous and oil spills are 10 times the normal incidence. There is no management in place.

To go by the PDVSA Caracas HQ is an insult to the eye and to our sense of smell. The walls of the building are covered with grafitti, painted by the two most violent 'Chavista' groups -- the Tupamaros and the Paracaimas -- both armed and harboring an intense social hatred for the middle class.

• In this environment, I am afraid there is very little hope for a civilized way out for Venezuela.

As the 'Powers' other than the Executive remain co-opted by Chavez, all doors to a peaceful solution are being closed. This is leading to increasing frustration among large sectors of the population that up to now have remained within legal bounds.

As this frustration mounts, it will get to the point where words are no longer the manner of exchange.

For someone who has a "revolutionary" dream, violence is the preferred path because it seems easier to destroy completely and to build anew, than to reform a house while inhabited by dissenting tenants.

This is our tragedy and it is unfolding right now, before the eyes of the international community.

Santayana said that those who forget history are obliged to relive it.

I have not forgotten what I experienced under Perez Jimenez, what I lived under Sukarno and what I saw happening in Cuba ... I do not intend to relive those years of horror.

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 ppcvicep@telcel.net.ve

www.vheadline.com Posted: Thursday, January 30, 2003 - 5:02:49 AM By: Gustavo Coronel

VHeadline.com commentarist Gustavo Coronel writes: Loyalty to an Institution is one of the rarest qualities of Venezuelan bureaucrats. Traditionally, loyalty among this personnel has been reserved for a man or a group with political power. The Venezuelan bureaucrat is frequently a client and serves a patron. By doing so, he or she obtains the favor of the powerful.

Although this is not new in Venezuelan politics, it has become overpowering during the current government. This is yet another sign that we are dealing with an authoritarian regime. Personality cult  and loyalty to patrons usually reaches very high levels during authoritarian governments. Citizens are either classified as unconditional followers of the leader or as enemies of the regime.

• I am enemy 985 of the regime in the latest ranking of the revolution as published by La Razon ... followed by Cardinal Velasco, at 986 ... all of this comes to mind when considering the tragedy of PDVSA.

I said in my last commentary that the reason for Chavez' merciless attack against PDVSA was his urgent need to politically control this institution and dispose (without limitations) of the $20 billion or so that the corporation generates every year for the Venezuelan nation.

When he arrived in power, he immediately started working towards that goal ... he fired the President of the institution and replaced him with another technocrat, who he felt would be more flexible.

Six months later, he realized that this new technocrat was loyal to the institution, but not to him. Therefore, he dismissed him in favor of one of his most loyal servants, Hector Ciavaldini. It did not matter that he was incompetent and mentally unbalanced, because all he was asked was to be faithful. He was so faithful that he wanted to outdo the master and decided he would annihilate the oil labor unions.

But the unions gave him a sound trashing. So, he also had to be removed.

Chavez then sent a fully-fledged, uniformed Army General to lead the corporation and to do his bidding ... General Lameda ... a man apparently loyal to Chavez ... did something unexpected. Once within the organization, seeing how the professional management behaved, he was won over to their side, becoming loyal to the corporation and not to the man.

At this point in time, Chavez became really enraged. As General Lameda was being driven to his office one morning, he heard on the radio that he had been removed from the presidency of PDVSA and that yet another President had been named in his place ... Gaston Parra,  a Marxist professor at a Maracaibo University.

Parra had spent most of his life writing articles about the need to purge PDVSA of anti-patriotic managers and to staff the company with real patriots. He did not know how oil was found, or produced, or refined, or transported, or sold in the world markets.  He did not have empathy with the managers he was going to supervise. In fact, he hated their guts.

But, he seemed to be a loyal follower and Chavez hoped he would not be a nitwit like Ciavaldini.

I wonder what Peter Drucker would think of this manner of selecting top officers for the most important company of a nation?

At this moment all hell broke loose. PDVSA managers, who had been outraged by the manner with which Chavez was trying to intervene the company; who had seen the arrival of political commissars and spies in their midst; who had silently suffered the verbal abuse of Chavez when he spoke of the need to audit the performance of PDVSA, intimating dishonest dealings, now refused to roll over and play dead.  They rejected the new president and the new board, stacked with friends of the government.

This rebellion actually ousted Chavez from the Presidency in April 2002, until he was brought back, not by the people but by General Baduel, the man who claims to have lived several lives and is now emerging as the strong man behind the puppet ... a kind of Venezuelan Noriega.

For the fourth time, therefore, Chavez was defeated in his attempt to control PDVSA. So he tried just one more time. From Vienna, he brought in Ali Rodriguez Araque, his former Minister of Energy.  A former guerrilla fighter during the 1960s, Rodriguez  had specialized in kidnapping and sabotage of oil facilities.

As a technical staffer for Shell in those years, I remember that the criminals' wrath was reserved for US companies. We kept putting up signs on our pipelines saying : "The Exxon pipelines are the others.... these are ours!" in the hope that they would spare ours ... and they did. They were selective!

So, Rodriguez came in and ... for a brief period ... things came back to "normal." He projected a suave, civilized image and tried to speak the proper language of business. But not for long. Chavez wanted a servant, not a manager ... and he got one. Rodriguez Araque opened the doors of PDVSA to the Bolivarian Circles ... he refused to dismiss the spies and commissars imbedded in the organization ... he promoted unworthy persons to positions of authority ... he became an instrument for the politicization of PDVSA ... and the managers would not accept it.

The managers of PDVSA went on strike ... not asking for bigger salaries, not asking for privileges, not asking for power. They went on strike, they put their jobs and future on the line to try to preserve the institution, to defend the institution against the desires of Chavez for political and financial control. This is what they were supposed to do as professional managers, as trustees of the institution and this is exactly what they did.

Their loyalty was not for one man, or one ideology, or one political tribe ... their loyalty was to PDVSA.

Today PDVSA is burning. I do not know if it will burn to the ground ... I hope not ... I trust PDVSA will be reborn after this nightmare.

I still hope we are not ... as the hobbit  Merry said in "The Two Towers" ... engaged in " a meaningless journey in a hateful dream."

I trust that the house of Mordor will fall, and that the Venezuelan people will be ... once again ... homeward bound.

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 ppcvicep@telcel.net.ve

Los momentos que confrontamos actualmente son de profunda crisis social, que afecta a los cimientos mismos de la sociedad venezolana, en sus diferentes niveles: valores, organización social, institucional y sobre todo la base económica. Precisamente es la economía, el fundamento esencial de toda organización social, si en algo tuvo razón Marx fue en señalar la determinación económica en la conformación de cualquier modelo social, en Venezuela es Petróleos de Venezuela (PDVSA) la empresa líder que define y marca la pauta del desarrollo económico del país. Al esta, declararse en paro cívico, compromete a toda la economía y al país mismo, hecho por demás relevante, importantísimo en la dinámica social. Ante tales circunstancia el Poder Ejecutivo se ha mostrado imperturbable, al negarse a atender la solicitud de una parte significativa del pueblo venezolano: ir a elecciones en un corto o mediano plazo. El gobierno tomó su posición y se mantiene en ella, cueste lo que cueste, a nivel económico, social o político. No importa que pasemos hambre, necesidad, desnudez, nada, así lo ha expresado el señor Presidente. En este contexto se ha propuesto “reformular” a PDVSA, en medio de esta crisis; con una premisa básica: sustituir a la mayoría de los cuadros gerenciales, llamados “nomina mayor” de dicha empresa, sin valorar las consecuencias y la posibilidad real de hacerlo, lesionando la esencia misma de PDVSA y de Venezuela. Partamos de que toda empresa es, producto de su Recurso Humano, del capital humano que la ha construido. Solo el hombre es el factor productivo indispensable e insustituible en cualquier proceso productivo, se puede poseer una tecnología de punta, la de mejor calidad y si no tienes el individuo capacitado para accionarla con eficiencia o eficacia, solo será un bien en propiedad, pero sin apropiación específica, es decir, podemos decir esto es mío y aquí lo tengo, pero no lo puedo utilizar, no lo puedo consumir. El capital cultural es una categoría del eminente científico social francés, Pierre Bourdieu, (fallecido hace un año), en su teoría concibe a la sociedad como un gran espacio social, donde coexisten diferentes campos sociales con una independencia relativa uno de otro; basa su concepción social en el principio de dominación, donde su ejercicio impone la diferencia social, como efecto de la posesión de diferentes capitales. Cuando se habla de capital, generalmente se asocia a recursos económicos, pero Bourdieu no lo restringe solo a ese dominio, sino que lo extiende y distingue cuatro tipos de capital: el económico, el cultural, el social y el simbólico. La definición y aplicación de sus categorías en su concepción social (estructuralismo genético o estructuralismo crítico) es realmente magistral, el estudio de dicho autor es apasionante y convincente, en razón de que cada una de sus categorías las demostró y aplicó en la práctica de sus investigaciones que fueron cuantiosas. En esta oportunidad deseo referirme al “Capital Cultural”: Está constituido por el conjunto de calificaciones intelectuales, que posee un individuo, sean éstas producto de la escolaridad particular y/o transmitida en su experiencia de vida, concibe este capital bajo tres formas de existencia: en estadio incorporado, en estadio objetivado y en estadio institucionalizado. Capital cultural en el estadio incorporado, es una disposición durable del individuo, supone un trabajo de inculcación y de acumulación particular, que no lo puede delegar en otro, es un capital obtenido por él mismo, inherente a él, por ejemplo los conocimientos adquiridos; “el capital cultural es un poder hecho ser, una propiedad hecha cuerpo, que pasa a ser parte integrante de la persona”(1) El capital cultural en estadio objetivado, se refiere a la posesión de bienes culturales, por ejem. obras de arte valiosas, colección musical, monumentos; este estadio es transmisible en su materialidad, pero no en su apropiación específica (puedo heredar una colección valiosísima de pintura y ni siquiera entender el por qué de su valor). El capital cultural en estadio institucionalizado es el aspecto socialmente reconocido respaldado por las instituciones, por ejemplo los títulos escolares; es la objetivación del capital cultural, que adquiere una autonomía relativa con relación a su portador, por ejemplo, es el “reconocimiento” del poder simbólico, que un título posee. Ahora bien, PDVSA se crea como tal en Agosto de 1.976, como producto de la nacionalización petrolera. Antes de la nacionalización, el modelo de desarrollo de los Recursos Humanos en la misma, provenía de la casa matriz de las distintas empresas transnacionales, todo los lineamientos venían del exterior, en consecuencia se observaba una marcada división en el personal integrante de la industria, con base en la formación profesional y nivel educativo que estos poseían; por una parte los puestos Ejecutivos y de Dirección conformado por personal extranjero altamente calificado, por otra parte los puestos medios, deficientes en cuanto cantidad y calidad, en razón de que no existía el personal calificado en Venezuela, y los puestos de nivel operativo, formado por obreros con poca calificación que se adiestraban en el desempeño del trabajo. Siendo los dos últimos niveles, venezolanos en su gran mayoría. Después de la nacionalización de la Industria y con la creación de filiales, se tomó conciencia de la necesidad de unificar las políticas de PDVSA. “Posteriormente la casa matriz realizó un diagnóstico que identifica la necesidad de promulgar una filosofía y estrategia corporativa de desarrollo ejecutivo común, que unificara criterios entre las distintas filiales” (2). Con esta concepción nacen las reuniones de planificación funcional, comité interfilial multidisciplinario, que en materia de Recursos Humanos elaboran el “Programa de Desarrollo Ejecutivo”, el cual se planteó como eje un sistema de desarrollo del personal con potencial directivo (con un perfil de formación académica, de valores en relación a la empresa y a su proyecto de vida). Producto de la implantación de ese sistema, tenemos hoy, 26 años después, ese Recurso Humano calificado con criterios de acreditación a nivel transnacional con empresas petroleras. Entonces, el capital cultural de esa nómina, tanto mayor como media o menor, de PDVSA no se puede sustituir de la noche a la mañana, ni de una manera drástica, como se pretende hacer, porque la planificación de sucesión de personal en una empresa como la petrolera (y siendo PDVSA líder en el ramo) tiene que hacerse con base en la sucesión del conocimiento y planificadamente. Las acciones del ejecutivo en este sentido solo nos dejará la lontananza de lo que una vez fuimos, en una pradera desértica, posiblemente en manos de extranjeros musulmanes. (1) Pierre Bourdieu. “Les trois états du capital cultural”, en Actes de la recherche en sciences sociales. No. 30. París 1.979 (2) Arnesto y Ortiz. Nuevas tendencias en Planificación de sucesión de Personal: Planificación de sucesión del conocimiento en el sector petrolero venezolano. Caracas 2000

Elaborado por: Arelis Figueroa L. C.I. 3.971.691 Profesora Universitaria. Tlf. 6054731/4751 0416-7045951