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Posted by FactReal on July 2, 2010

In January 2009, Venezuela’s state-run oil company (PDVSA) owed the U.S. driller Helmerich & Payne (H&P) close to $100 million. H&P, as any business or employee, cannot operate without getting paid. H&P stopped operations on two of its drilling rigs. Marxist Hugo Chavez responded by nationalizing H&P’s rigs.

Via Reuters:

Venezuela’s government took formal ownership on Thursday of 11 oil rigs seized from U.S. company Helmerich and Payne .

Socialist President Hugo Chavez has nationalized most of the Latin American country’s oil industry, starting with major heavy crude projects worth billions of dollars in 2007, then taking over dozens of smaller service companies last year.

Oil Minister Rafael Ramirez said last week the OPEC member would nationalize the rigs following a year-long dispute over pending payments by state oil company PDVSA.

AP has the background story:

Venezuela’s government has seized control of 11 oil rigs owned by U.S. driller Helmerich & Payne, which shut them down because the state oil company [PDVSA] was behind on payments.

Oil Minister Rafael Ramirez announced that Venezuela would nationalize the Tulsa, Oklahoma-based company’s rigs. He said in a statement Wednesday that Helmerich & Payne had rejected government demands to resume drilling operations for more than a year.

Helmerich & Payne announced in January 2009 that it was stopping operations on two of its drilling rigs, because Venezuela’s state-run oil company, PDVSA, owed the company close to $100 million. It said it would shut down the rest of its rigs by the end of July as contracts expired unless PDVSA began to make good on its debts.

The company said Thursday that PDVSA’s debt was $43 million as of June 14.

Referring to Helmerich & Payne, Ramirez said: “There’s a group of drill owners who have refused to discuss service prices and have preferred to have this equipment put away for a year.”

President and CEO Hans Helmerich said in a statement on Thursday the company’s 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,” he said.

Helmerich & Payne Comments on News Reports in Venezuela (Print-out)


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