Italy's ENI Reaches 1 Billion Agreement with Chavez's Venezuela for Nationalization

Historically, Powerful Nations have either Intimidated Smaller Mineral Rich countries, or Installed and or Supported Puppet Governments to award "Sweetheart" deals to that Powers Corporate/Trading Interests to "Raid" that country's riches.

In early 2007, Venezuela’s president Hugo Chavez gave some of the world’s biggest oil companies a choice: turn over majority control of their projects to a state-owned company and remain as minority partners, or face a complete nationalization of operations in Venezuela’s Orinoco River basin. Ultimately, Exxon and ConocoPhillips opted to leave, while BP and Norway’s Statoil decided to stay.

Venezuela is among a small but growing number of resource-rich countries to put the squeeze on international corporations. Russia early this year pressed both BP and Shell into turning over majority stakes in Russian gas operations to state-owned Gazprom. Bolivia nationalized gas and oil fields, and Ecuador used troops to take over Occidental Petroleum’s holdings. It is not just the oil and gas sector facing renationalization. Zimbabwe’s government said in June it would nationalize the country’s uranium as well as its coal and methane projects. To the resource-rich developing states involved in such moves, it is an important signal of sovereignty.

Exxon and ConocoPhillips have lobbied the US Government to "demonize" Chavez, as a Narco Dictator (although elected), a Terrorist Haven, and freeze Venezuela's assets in the US, (10 x reasonable value) and threaten Venezuela with military action, even though Chavez's agenda is similar to that of Hillary and Obama.

ENI of Italy on the other hand has chosen to be "civilized" and negotiated a $1 Billion settlement [Or perhaps, ENI wasn't able to convince Bush to 'bully" Chavez on it's behalf :)

Petroleos de Venezuela Says Agreement With Italy's ENI Reached

Blooberg News By Matthew Walter February, 16 2008

Petroleos de Venezuela SA, the state oil company, said it has reached an agreement with Italy's largest oil company, Eni SpA, for compensation for a Venezuelan oil field the government took over in 2006.

Venezuela's oil and energy ministry confirmed the agreement today in an e-mailed statement. Eni Chief Executive Officer Paolo Scaroni said yesterday the company had agreed to accept book value for its stake in the Dacion oil field in Venezuela. Each side declined to say how much was paid.

In a 2006 filing the Securities and Exchange Commission, Eni said the Dacion field had a book value of 654 million euros ($959 million).

To contact the reporter on this story: Matthew Walter in Caracas at mwalter4@bloomberg.net .

Last Updated: February 16, 2008 11:34 EST