Swift wrote:Sorry Sigma, I haven't been keeping up and so my reply is a little out of date, but I wanted to add a couple of biased thoughts (I'll explain the bias in a moment).
My take on one of the reasons for the lack of investment in the oil infrastructure is that Venezuela keeps nationalizing the infrastructure built by foreign (US) companies. My bias comes from a personal example - the company I work for built a plant in Venezuela to make proppants for the oil industry; several years ago it was nationalized and basically taken away from us, with no compensation (I think we got a payment for some trivial percentage of our investment). The only "compensation" is that we understand without our engineering help, that the plant has basically stopped working and been shut down.
There are numerous similar incidents to this; I suspect you can rattle them off better than I can.
External companies are just not going to do business with Venezuela under such conditions, and quite frankly, I doubt Venezuela has the technological and financial resources to do it on their own. So the decline in the infrastructure is pretty much assured.
Yeah, that's about the size of it.
Back in 1971,
this moron signed a law that would gradually nationalize our oil concessions. then in 1976
this idiot unilaterally nationalized all the oil Industry. At the time he did pay (an inflated) compensation. Why was it inflated? well he payed a lot of OUR money to accelerate the process for no other reason than to plant the flag, thump his chest and say "I'm a patriot, now our oil is really OURS"
It wasn't as bad because at least we had a small amount of local expertise in managing the existing oil fields. But, of course, there was little new investment, and Production stagnated
After 1989 the government reversed course and opened oil concessions again and SURPRISE! oil production increased again.
After the 2003 Oil strike. Chavez fired most of the striking workers at PDVSA and replaced them with people who favored him and his revolution, and of course, in 2007 he kicked all of the Oil Multinationals out of the country in a manner very similar to what you mention.
I agree with you, we DON'T have the technical expertise and (specially now) nowhere near the financial muscle to fix our mess. Our production continues to decline, we have to start working on our the Heavy Oil reserves which are relatively expensive to exploit and on top of that the price of oil dropped sharply. As usual we made our bed.
While I'd love to place the blame on Chavez and his clique, it's really a cultural problem we as a country have. We don't want to do the hard stuff and also expect others to do it for free. THAT sums up the history of this country in one sentence.