Stuart Munckton

Associated Press reported on March 29 that Venezuela’s oil minister Rafael Ramirez has said US oil giant Exxon Mobil is no longer welcome in Venezuela. Exxon Mobil had attempted to resist new legislation passed by Venezuela’s left-wing government that forced foreign oil companies to sign new contracts giving the state-owned oil industry at least 51% control over all ventures.

The new law also dramatically increased tax and royalty rates to the Venezuelan state. The extra money raised has been pumped into social programs that benefit Venezuela’s poor majority.

Refusing to submit to Venezuela’s new laws, Exxon Mobil had sold its investments to the Spanish multinational Repsol YPF. Rodriguez commented that “There are some companies that prefer to leave” rather than submit to the new regime, adding “We said we don’t want them to be here then”.

The AP report noted that the Texas-based Exxon Mobil — the world’s second-biggest oil company — was the only foreign company investing in Venezuela to publicly speak out against royalty increases, while others quietly accepted the terms.

Business Week reported on March 29 that French oil firm Total had agreed to pay back some US$19.4 million in back taxes, part of a $107 million bill the government insists Total owes and must pay in order to continue operating in Venezuela.

From Green Left Weekly, April 5, 2006.
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