Venezuela seizes oil rigs owned by US company

reply to post by intrepid


"who would be willing to invest in that country in the future? "

A: China? Russia?

reply to post by intrepid


I'm with you on this one; whether there was a plan in place to handle the nationalization of their rigs, the fact is this sends a very clear message to wealthy foreign investors: We will take your assets for ourselves when it suits us (or when you bitch because we fail to pay you).

That bodes ill for the future of Venezuela... no foreign investment, GDP tanks - GDP tanks, basic social services and infrastructure begin to dwindle... I think we can all do the math from there.

Originally posted by intrepid

Originally posted by FreshAir
I would suspect that by simple fact of operating in Venezuela, or any other country in which there is a threat that the foreign company may be nationalized, there is a business plan in place to account for that potential liability. Business will have taken this possibility into consideration before moving in...

BUT the point is, who would be willing to invest in that country in the future? This will take some time but Chavez is eventually going to be bitten on the ass with the way he's doing things. Foreign investment goes, a country collapses. The people get pissed. We may actually see him lynched.

No country is an island anymore. You need more. Good luck Hugo.

I fully agree with your assessment and am certainly not defending Hugo! His actions, over time, will eventually drive "his" (because they are not their "own" in Hugo's eyes) people into a wall. The populace will eventually have to do something about him. Nationalizing other countries investments in country, will only isolate him further. Eventually, this course will end.

Originally posted by Blaine91555
This is theft by a thief, pure and simple. Chavez is a what he is. He is likely going belly up before long. Buying the Dictatorship of a country can't be cheap.

Obama won't do anything. I'd expect Chavez is one of his personal hero's.

Maybe they owed the country tax and didn't pay so why not seize the assets in much the same way as the western world would do.

Are you a bit suprised that a little country is not quaking in it boots because the USA says jump or could it be that so many little countrys are now againt the zionist controlled USA that they know who going to win the school ground bully if push comes to shove.

if you're looking for Obama's freinds then may i sugest you take a look at golen ball sacks and iserail long before you look at chavez.

Well now...On it's face this appears to be a nonpayment issue where the Ven. Gov wants the US company to keep working despite being owed millions.

While my response would be to take over all Citgo Gas stations Owned by The Ven Gov. here in the US or freeze some Ven. assets.....Obama/Hilary will most likely do little to respond.

reply to post by Legion2112

It will be interesting to see whether Venezuela sign a new or extend an existing deal now with either China or Russia re: oil.

Could it be possible that this action/play, including the non-payment was all part of a plan to obtain/transfer/secure access to the resource (oil in this case) by Venezuela's future trading partner and ally of choice (I suspect): China?

If so, China wins access to yet more resources whilst being able to maintain a discreet distance from any 'actions' that could be easily or irrefutably proven to be 'directed' from China, although that would surely be likely?


[EDIT: I think China/Venezuela may be/have been playing a longer term game here?]




[edit on 24-6-2010 by curioustype]

reply to post by realmatrix


If our government had one hair on its collective testicles, which I doubt, it would freeze all Venezuelan assets in the Unites States and start paying down its debt with them...

Perhaps this has already been financed - a done deal?:

"Chávez Says China to Lend Venezuela $20 Billion
By SIMON ROMERO
Published: April 18, 2010

CARACAS, Venezuela — President Hugo Chávez said over the weekend that China had agreed to extend $20 billion in loans to Venezuela, pointing to deepening ties between the two countries as China seeks to secure oil supplies here. "

www.nytimes.com...

[EDIT: Anyone care to speculate how soon oil will begin shipping to China and/or their interests from these very same wells?]

[edit on 24-6-2010 by curioustype]

reply to post by Someone336


Actually, that is on topic. It goes to the heart of this.

While we run headlong into the abyss Russia just dug itself out of, I'd imagine they just shake their heads and wonder.

Europe is not doing well by the way. They are in worse crap than we are financially and are a decade ahead of us in that type of government. Again I say look at Greece. It's screaming to the world. This is where you are headed.

Look at who Obama has surrounded himself with. It's right there in our faces what is going on. Cap and Trade and you better have a good stash of money or a government job, because anyone who does no is in deep ...

There was a time not long ago that seizing a countries businesses or assets was an act of war. In this case, Chavez will likely get the Presidential Medal I'm afraid.

reply to post by curioustype


First Africa, now Venezuela to get a foot hold on the America's. Coincidence? Unplanned?

reply to post by LieBuster


You love a Dictator so much you are making up theories to side with him? Who is not centered in reality here. My God, the man took over the media, he is bankrupting what could have been a rich Capitalist nation just like Castro did.

Goldman Sachs, Obama, Soros are all the same people. Nothing I said excused them. Nothing at all. So I don't get that point. they are easy to understand. Nationalize all business, Unionize all workers and of course with them in control and very, very rich.

reply to post by realmatrix

My opinion is that this is yet another example of the Chinese tying the USA up in knots (diplomatically and strategically speaking) with yet another Chinese secured ally taking apparently independent action (launching an independent dispute under their own national flag) which ends, surprise,surprise, in either a loss of access or complications or drawing the USA and it's military into ever more thinly spread and geographically stretched theatres of conflict/supply chain problems.

Back before the USA banking collapse/global economic downturn (about which China are not best pleased) China described their (phenomenal) acquisition of power, influence and resources (e.g. in S. America) as something like a 'Quiet Ascendency', does anyone else get the feeling they aren't too concerned about hurting the USA's feelings anymore and the process is being accelerated?

I see parallels here with Argentina's recent fresh challenges to Falklands oil exploration by the UK too. My understanding is that the populous there don't generally think it would be a good idea for Argentina to get drawn into (armed) conflict with the UK again, especially now they are probably worse off economically/financially/militarily than they were back in the last war.

Yes oil is a big draw, but I think the fundamental catalyst/motivation for their fresh challenge came via their leadership and from China, who have recently pumped money in to support Argentina, with a view to getting a great deal on mineral wealth extraction. I think perhaps Argentina were either directly (but covertly) or indirectly (motivated by the knowledge that their buyer would buy/support them) [edit: acting in China's interests - in a way nobody else could openly challenge - say in the UN]?

Why else risk a war unless you already have such powerful backing/orders?

[edit on 24-6-2010 by curioustype]

Originally posted by curioustype
Back before the USA banking collapse/global economic downturn (about which China are not best pleased) China described their (phenomenal) acquisition of power, influence and resources (e.g. in S. America) as something like a 'Quiet Ascendency', does anyone else get the feeling they aren't too concerned about hurting the USA's feelings anymore and the process is being accelerated?

Why wouldn't they? The Chinese have damn near unlimited resources. The human one being foremost. This has been going on since man has been on this planet. I can point out the progression if you like. With a side avenue to the Eastern part of the globe. From our perspective.

That said, the Chinese can NOT go against the US in military battles, in the air and on the water........ yet. On the ground? Different story. Logistic say that that would be damn near impossible.

reply to post by intrepid


Looks to me that the USA is currently content to focus both it's military resources (air/sea) and populous (via media) on potential conflicts with (aledged?) allies, or at least future key suppliers, of China, (e.g. Iran, N.Korea, Venezuela) but why?

Why not challenge China directly, if like us they can see the pattern?

Is this just a holding position prior to a genuine major conflict? Will there be a tipping point? Or are the USA leadership also bought up and working against the USA populous in the interests of Chinese money/futures?

I sometimes wonder...

reply to post by Blaine91555

While we run headlong into the abyss Russia just dug itself out of, I'd imagine they just shake their heads and wonder.

You mean Russia, where two/thirds of the populace misses the Soviet Union?

Europe is not doing well by the way. They are in worse crap than we are financially and are a decade ahead of us in that type of government. Again I say look at Greece. It's screaming to the world. This is where you are headed.

Greece isn't full of nationalized industry. In fact, the only nationalized industry it has, I believe, is their airline service. Hardly the cause of a financial meltdown. No, the blame lies with international money gangsters like Goldman Sachs, - hardly a socialist institution - and unrestrained spending by overzealous politicians without first implementing the proper financial reforms.

Second, the self-described "socialist" countries in northern Europe, the ones who opted out of joining the EU and maintain nationalized oil and banking industries, are by far the most financially successful of the Eurozone countries. I wonder why that is?

Perhaps because free markets are a lie. I do believe in letting markets take their course for the most part, but the fact of the matter is that it is state-interferred economies that fair the best. Look at the so-called "free market miracle", Chile: nobody bothers to mention that the basis of their economy, copper, is produced by a nationalized industry. The flourishing capitalist economy in Taiwan was, in the beginning, a state directed effort, backed by none other than the king of all free market principles, the United States. The exact same is to be said for South Korea and Japan

reply to post by Blaine91555


Last i checked we too are living under a dictator because our govermernt does not do or ask the people what they want and we get to vote for dog $hit or cammel $hit once in a while.

Democracy is not working and i hardly know of anyone that agreed to baling out the zionist bankers and to then close schools and hospitals down to pay for it all or to having CCTV every half mile on sections of our motorways.

My bet is Chav has more genuine suport from the people than our so called elected officals get and the same goes for castro.

if you enjoy the ilusion of freedom then i'm happy for you but do watch out because you can only deny the obvious for so long.

You think you have freedom then tell them to stop doubling the money supply because it halfs the value of money in your pocket or tell them to sort the Bp leak out better then they are doing or if they allow it in your country then try to watch Russia Today so you at least get a balance of propaganda.

OK i'm being a bit hard on you else you would not be on this site but realy these people have just as much suport from citizens as any western leader has.

You mean Russia, where two/thirds of the populace misses the Soviet Union?

Why does this not suprise me.










[edit on 24-6-2010 by LieBuster]

I could be reading this wrong but the oil company simply filed losses on there tax return due to unpaid bills from Venezuela. Not that there equipment has been taken. Venezuela offered to buy there equipment but never offered to pay there bill for work rendered in the past.

www.hpinc.com...

Helmerich & Payne Comments on News Reports in Venezuela
TULSA, Okla., June 24, 2010 /PRNewswire via COMTEX/ --Helmerich & Payne, Inc. (NYSE: HP) commented on recent media reports that refer to Venezuelan government authorities affirming that they will seek to nationalize the Company's 11 rigs in Venezuela. The Company has been in recent discussions with PDVSA (the Venezuelan national oil company) in efforts to achieve a mutually beneficial agreement that would address both PDVSA's desire for the Company's rigs to return to work and make progress towards collecting unpaid invoices corresponding to services rendered in prior years. The Company communicated to PDVSA on numerous occasions that it would be willing to enter new drilling contracts for drilling work in Venezuela if and when significant progress was achieved in terms of such receivable collections and currency conversion. PDVSA recently informed the Company that it would be interested in buying the Company's drilling rigs in Venezuela should the Company not be willing to return to work without such pre-conditions. The Company recently offered to sell rig assets to PDVSA. As of this morning, the Company has not received any notification from Venezuelan government authorities or from PDVSA regarding nationalization or expropriation of the Company's rigs or other assets.

President and CEO Hans Helmerich commented, "Our dispute with PDVSA has never been very complicated and our position has remained clear: We simply wanted to be paid for work already performed. We stated repeatedly we wanted to return to work, just not for free. We are surprised by yesterday's announcement only because we have been in ongoing efforts in a good faith attempt to accommodate a win-win resolution, including a willingness to sell rigs. We have worked in Venezuela for 52 years and wanted to continue under reasonable conditions. At the same time, Helmerich & Payne has reduced its number of rigs in Venezuela in half since 1998. At that point, almost 30% of our land rigs were in that country, as compared to under 5% of our land rigs today."

As previously reported in the Company's public filings, all 11 Helmerich & Payne rigs that formerly worked for PDVSA completed their contract obligations during calendar year 2009. Since then, these conventional land rigs have been idle in Venezuela and remain in our facilities there. The total invoiced amount by the Company that remains due from PDVSA as of June 14, 2010, is valued at approximately $43 million (U.S. currency equivalent), including approximately $36 million in invoices issued since the Company changed its revenue recognition to cash basis for its Venezuelan operation. Also pending resolution is an exchange with PDVSA of local currency (Bolivar Fuerte) for U.S. dollars as a result of PDVSA unilaterally paying U.S. dollar invoices (issued in 2007 and 2008) in local currency. Furthermore, since July 22, 2008, the Company has had an outstanding application with the Venezuelan government requesting approval to convert local currency cash balances to U.S. dollars for dividend payment purposes. When and if the Venezuelan government approves this application, the Company's Venezuelan subsidiary is expected to remit approximately $14.2 million, adjusted for the January 2010 currency devaluation, as a dividend to its U.S. based parent.

At May 31, 2010, the Company had approximately $30 million (U.S. dollar equivalent) in cash denominated in local currency in Venezuela. As of the end of the second fiscal quarter of 2010, the Company's consolidated balance sheet included approximately $67 million in net book value of long-lived assets comprised of property, plant and equipment in Venezuela, and approximately $5 million in equipment inventories in that country. Other less significant current assets and liabilities related to Venezuela are also included in the Company's consolidated balance sheet. For additional details related to the Company's operations and risks in Venezuela, please refer to the Company's latest annual report on Form 10-K and to its latest quarterly report on Form 10-Q.

Helmerich & Payne, Inc. is primarily a contract drilling company. As of June 8, 2010, the Company's existing fleet included 214 U.S. land rigs, 39 international land rigs and nine offshore platform rigs.

Statements in this release are "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934 and are based on current expectations and assumptions that are subject to risks and uncertainties. For information regarding risks and uncertainties associated with the Company's business, please refer to the "Risk Factors" and "Management's Discussion & Analysis of Results of Operations and Financial Condition" sections of the Company's SEC filings, including but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q. As a result of these factors, Helmerich & Payne, Inc.'s actual results may differ materially from those indicated or implied by such forward-looking statements.

SOURCE Helmerich & Payne, Inc.

Good questions

Originally posted by curioustype
Why not challenge China directly, if like us they can see the pattern

The Chinese think SOOOOO differently than we do. A direct challenge would be met with the same. Don't try to bluff the PRC. You've got about 1.3 billion Chinese that actually support their way of life. Until their system collapses China is going to be strong.

Is this just a holding position prior to a genuine major conflict?

I think so. It won't be military though. It'll be economic imo. Depending on how long it takes for the Chinese to want a bigger screen TV. See what I mean?

reply to post by buni11687


Ouch that hurts.

You have my deepest sympathies. And I sincerely hope the price of petrol there stays stable.

I know the economic pain your people are in and I give to charity when I can. But still, I am only one man. And so many are suffering now.

Stay strong USA.