Caracas Gringo

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Archive for January 2009

Pdvsa: Significantly under 2 million b/d before June?

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President Hugo Chavez and his faithful crony, Energy Minister Rafael Ramirez, claim that Venezuela’s crude oil production capacity tops 3.4 million b/d – which is a lie, of course.

Petroleos de Venezuela’s real crude oil production presently averages about 2.3 million b/d, assuming the Chavez government has not implemented any of Venezuela’s assigned production cuts (totaling over 300,000 b/d if the three cuts decided by Opec since August 2008 are combined).

But Pdvsa is believed to have forced about 190,000 b/d of Opec-mandated production cuts on its joint ventures with foreign companies. In effect, JV’s accounting for about 25% of Venezuela’s total crude production are shouldering about 60% of the country’s assigned Opec production cuts.

If so, then Venezuela is currently producing about 2.1 million b/d, which means that in order for Pdvsa to meet local and international supply commitments the company is buying a great deal of oil on the open market.

However, it gets potentially much worse very soon.

As of 30 September 2008, Pdvsa’s accounts payable totaled over $7.8 billion, according to the company’s third quarter financial report. But Pdvsa stopped paying oil services companies, other contractors and suppliers in August 2008.

At mid-January 2009, Pdvsa’s finance vice president, Eudomario Carruyo, said the company’s unpaid debts had grown to over $11 billion, though Caracas Gringo is told the real total is closer to $12.5 billion as of 31, January 2009, including over $1 billion owed to US oil services companies Schlumberger and Halliburton.

Understandably, oil services companies are starting to shut down their operations and fire workers. No pay, no play.

Dallas-based Ensco International last week halted operations on a jack-up drilling rig in the Gulf of Paria. Pdvsa subsidiary Petrosucre is now operating the rig, but Ensco will remove it from Venezuela when its contract ends in a few weeks. Ensco reportedly is owed about $40 million.

Tulsa-based Helmerich & Payne last week also shut down operations at two of the 11 rigs it has in Venezuela, and expects to shut down the nine still in operation by July. Pdvsa owes H&P about $100 million.

And a consortium in which Vinccler is a partner also halted work about two weeks ago on a gas compression plant which is a vital part of the Anaco Gas project which Pdvsa Gas is developing.

Pdvsa is pleading for a little understanding and steep discounts.

One Pdvsa official told Platt’s Oilgram last week that the reason the company isn’t paying its bills is that everyone in Pdvsa is too occupied working for the success of President Chavez’s re-election referendum. Of course, this is cow flop.

Carruyo says the oil services companies, contractors, et al have been asked to subtract “at least 40%” from their unpaid invoices to take into account sharply lower oil prices.

“They raised their billed costs over 40% when oil prices were high, so now that prices are down sharply they should reduce their bills to us,” Carruyo explains.

Meanwhile, Pdvsa’s production will fall in coming months if more oil services companies reduce or suspend their operations in Venezuela, and the drop in production could be very significant, averaging between 250,000 b/d and 500,000 b/d, by some independent estimates.

Venezuela’s oil industry is quite old. The majority of Venezuela’s producing oil fields were in production years before 1970. In fact, Venezuela had a relatively mature oil industry before WW2.

As a result, Venezuela has one of highest oil depletion rates in the world, averaging about 25% annually if both natural and mechanical depletion are combined.

Venezuelan oil fields require a great deal of 24/7 maintenance to offset natural depletion and keep the mechanical infrastructure, much of which has been operational for up to 50 years, in good condition.

If the oil services companies curtail or suspend their activities, essential maintenance will be discontinued and production will plummet.

But there’s more.

The more than $12 billion Pdvsa owes its contractors and suppliers is creating disruptions in Venezuela’s financial sector, since the unpaid oil services companies and contractors cannot stay current with their own debt payments to creditors.

The unpaid oil services companies and other contractors also are starting to lay off thousands of workers, stoking more discontent among an increasingly restive army totaling about 150,000 workers if Pdvsa’s payroll and non-Pdvsa oil industry payrolls are combined.

In a worst case-scenario, Pdvsa’s oil production could fall under 1.8 million b/d by mid-2009, and its operations could be disrupted even more by a conflict with the oil unions over money which Pdvsa doesn’t have.

Written by Caracas Gringo

31/01/2009 at 19:00

Posted in Uncategorized

One traitor accuses another traitor of treason

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Yoel Acosta Chirinos tells AFP that President Hugo Chavez, in power exactly one decade on Monday, 2 January, 2009 “betrayed the Bolivarian project” and “forgot the Constitution.”

“I believe (Chavez) betrayed the original project, the Bolivarian project for which we insurrected… (Chavez) forgot the strategic objective of transforming representative democracy into participative and protagonistic democracy and (instead) he went towards 21st century socialism,” says Acosta Chirinos.

The original Bolivarian project “never considered notions of socialism…We had an ideology based on the Bolivarian ideal, but we never spoke of (Karl) Marx and (Vladimir) Lenin, and much less a copy of Cuba…Chavez betrayed the roots…the group of doctrines integrated by Bolivarian thought,” he adds.

In fairness, let’s credit Acosta Chirinos for condemning the endless treacheries of President Chavez. But spare no sympathy for Acosta Chirinos, because he is also a traitor.

Former Army Lt. Colonel Acosta Chirinos was a co-conspirator and co-leader of the 4 February, 1992 failed coup in which Chavez was the titular – albeit gutless – leader.

[Brief recollection of history: Lt. Col. Hugo Chavez Frias, the titular head of the 4 February, 1992 coup against then-President Carlos Andres Perez, did not follow the plan, deviated from his route, refused to respond to repeated radio calls from his comrades, stopped his forces well short of his assigned tactical objectives in Caracas, and immediately started to negotiate his unconditional surrender without ever firing a shot.]

Of course, Chavez always planned to surrender immediately. He knew from the start that his coup would fail. In fact, in order for the coup to work in Chavez’s favor it had to fail.

Chavez never expected to seize power, and much less co-rule a new Bolivarian militarist/nationalist regime with his co-conspirators. Chavez never believed in power-sharing, although he always fooled his closest political allies into believing that he would be a democratic Bolivarian revolutionary.

However, Chavez needed a failed coup in order to launch his political career as Venezuela’s future strongman-for-life. So Chavez followed the historical example of two key influences in his formative years as a treacherous conspirator.

Chavez’s failed coup of February 1992 essentially replicated Fidel Castro’s failed assault against Batista’s Moncada barracks in 1953 and Adolf Hitler’s failed beer hall putsch in 1923. Castro and Hitler were arrested and jailed, but ultimately both triumphed, as did Chavez.

After Chavez was inaugurated as president in February 1999 he started to systematically sever old political alliances and friendships; Acosta Chirinos was among the hundreds who were dumped and neutralized by Chavez.

So, in essence, Acosta Chirinos’ interview with AFP is one traitor whining about how he was betrayed by another traitor. What chutzpah!

Acosta Chirinos betrayed his oath as an officer in the army of Venezuela, the same one forged by the Liberator Simon Bolivar, the most revered figure in the Venezuelan pantheon of nation-founding heroes. Bolivar is to Venezuelans what George Washington is to Americans.

Acosta Chirinos also betrayed the democratically elected government and the constitution of Venezuela for years before the failed coup in 1992 while sneaking around the country clandestinely meeting with other conspirators which included radical communist guerrillas, many of whom had direct ties to Cuban intelligence; so his claim that the conspiracy in which he participated never embraced foreign communist influences like Castro, etc. is more verbal compost.

But Acosta Chirinos can always follow the example of another former co-conspirator and co-leader of the failed coup, Franciso Arias Cardenas, who severed relations with Chavez early in the latter’s ten-year rule but then groveled his way back into El Comandante’s favor, and was rewarded with the plum post of Venezuelan Ambassador to the United Nations.

Written by Caracas Gringo

31/01/2009 at 17:45

Posted in Uncategorized

Masked thugs trash a Synagogue at night

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‘Malicious men may die, but malice never.’
Moliere, Tartuffe, 1664

Foreign Minister Nicolas Maduro says the government of President Hugo Chavez will investigate, find and jail the individuals who vandalized a Jewish Synagogue last night in the Mariperez area of Caracas.

Hypocrisy comes easy to the thugs who rule Venezuela.

The vandals broke into the Synagogue at night, heavily armed and wearing masks, desecrated the Torah and scrawled hateful graffiti on the walls.

We’re certain of two things:

*Any official “investigation” will hide the truth and most likely will seek to accuse elements of the government’s political opposition. The government will never admit any of its thugs destroyed the Synagogue, though it’s obvious from where the increasingly violent anti-Semitism is originating in Venezuela.

*President Chavez, more than anyone else in Venezuela, is the individual most responsible for the destruction of the Synagogue.

President Chavez is also the individual most responsible for last Thursday’s gunfight between Anzoategui state police and workers at Mitsubishi’s vehicle assembly plant in the city of Barcelona. Two workers were killed and six (including five police officials) were wounded by the gunfire.

The gunfight erupted when over 130 laid-off workers who had seized the plant for several days to pressure company management to rehire them tried to physically prevent two judges from executing a restraining order against the workers. Close to 30 Polianzoategui officials accompanied the judges (both women) who tried to serve the restraining order against the workers.

The workers and police got into a scuffle; rocks and tear-gas were exchanged, a vehicle was set ablaze, and then several unknown individuals inside the plant opened fire at the police, who immediately returned fire as workers scattered in all directions.

Anzoategui Governor Tarek Willians Saab immediately announced that any Polianzoategui officials who fired their weapons would be jailed and prosecuted for attempted murder. The governor also blamed the shooting on the private security firm employed by Mitsubish to guard the facilities. In other words, the shooting was the fault of Mitsubishi’s management. However, local labor court officials blamed the violence on the workers.

“They didn’t bother to pursue this through legal channels and file a grievance in labor court against Mitsubishi,” an aide to one of the judges said. “Instead, they resorted immediately to conflict, seizing the plant and attacking the judges and police.”

But the workers have a ready excuse which senior thugs of the Bolivarian regime like Governor Saab will defend. President Chavez has been saying for ten years that violence is good when the violence is inflicted to defend the Bolivarian revolution and the “rights” of the poor and workers.

During his decade in power, President Chavez has fostered and legitimized violence as the act of first resort in all situations. Chavez repeatedly threatens to use violence against everyone who obstructs his will. The Chavez government over the years also has coordinated the creation of numerous civilian groups which have received money and weapons from the government to go out and attack the regime’s political opponents.

Under Chavez, Venezuela has been transformed from a moderately violent country into the most violent nation in Latin America, and one of the most violent in the world.

Ismael Garcia, leader of Podemos (the former pro-Chavez faction of MAS, back in 2000-2002), said last week that the homicide rate in Venezuela has soared over the past decade from 4,481 officially reported homicides in 1995 to 14,400 homicides in 2008 (over 3,000 higher than the government admits officially).

Garcia says his data shows that 37 people are murdered daily in Venezuela, and a homicide occurs every 40 minutes. The homicide rate per 100,000 inhabitants is 25.6 for Latin America overall, but in Venezuela the homicide rate stands at 53 per 100,000 inhabitants.

There’s a saying in Venezuela: “A todo cochino le llega su sabado.” Rough translation: What goes around comes around.

Call us pessimists, but political and criminal violence in Venezuela very likely will get much, much worse before Chavez’s Saturday finally arrives – especially if he loses the 15 February referendum on amending the Constitution to allow his perpetual re-election.

Written by Caracas Gringo

31/01/2009 at 16:39

Posted in Uncategorized

Meet Evo’s Montesinos

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The real power in Bolivia

The real power in Bolivia

Read more here.

Written by Caracas Gringo

31/01/2009 at 11:20

Posted in Uncategorized

Play the Bailout Game

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Gringos play monopoly, Russians play chess, and now you can play the Bailout Game. Be a Greenspan, Bernanke or Paulson. Save Wall Street, and end the global financial crisis…or not!

Written by Caracas Gringo

31/01/2009 at 11:16

Posted in Uncategorized

…for God’s Sake!

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Jesus is just all right with me, Jesus is just all right, oh yeah...

Jesus is just all right with me, Jesus is just all right, oh yeah...

Paraguay’s President Fernando Lugo, a former Catholic Bishop and leading Liberation Theology proponent, called at the World Social Forum for the creation of a “religious Mercosur” and invited all of the region’s religious leaders to an ecumenical summit in Asuncion on 12-13 March.

Lugo says he wants to give Mercosur “a people’s face” and insists the regional “discussion of religiosity, which is so important,” cannot be absent from relations between the nations of South America. Lugo also revealed he already has invited the Brazilian liberation theologists Leonardo Boff and Carlos Alberto Libanio Christo (aka Frei Betto) to the event in Asuncion.

It will be interesting to see what happens at Lugo’s religion summit, and who attends. The resuscitated Liberation theologists of the 1960s were Catholic rebels in a region that was over 90% Catholic. However, while Catholicism still predominates, South America is also populated liberally today with Evangelical Christians (Protestants) and Muslims. And over three decades of indigenous rights activism has strengthened indigenous native religions in many countries.

Has Lugo invited the region’s evangelical Christian leaders and Muslim Imams to his religion summit? Will the event also be well-attended by indigenous shamans from the hundreds of Andes and Amazon tribes in the region? Will the Babalus and other Afro-Caribbean voodoo and spirit-worshiping faiths also be represented? We wonder, also, how Lugo will seek to reconcile the ideological secularism of the region’s current crop of socialist leaders with the tired old silliness of Marxist-flavored Catholicism, which is all that liberation theology really is.

Written by Caracas Gringo

30/01/2009 at 19:23

Posted in Uncategorized

More Presidential Bullshit

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President Hugo Chavez said on national television today that accusations by retired Army General Raul Isaias Baduel, who yesterday claimed his car was attacked by individuals who hurled tear gas grenades and fired multiple shots into the vehicle, are a “plot created by the CIA’s psychological war laboratories and the commanders of the Pact of Puerto Rico.” Chavez and Baduel were allies not long ago. Baduel saved Chavez’s presidency in April 2002, and later was rewarded with the highest command posts in Venezuela’s armed forces, but now Chavez routinely condemns Baduel as “one of those sad personalities that will pass into history as one of the great traitors of this process…” Actually, Baduel likely will be remembdered as a political opportunist who wasted a legally and constitutionally justified opportunity to depose a president guilty of crimes against humanity and murder, while Chavez likely will be remembered by future generations of Venezuelan historians as the great betrayer who ruined Venezuela’s economic and social development prospects for at least two generations.

Written by Caracas Gringo

30/01/2009 at 18:58

Posted in Uncategorized


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