Recent Appearances...

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Recent Appearances...

Caribbean-Latin America

Chevron in Venezuela: The Biden administration's sanctions relief explained

2022-12-06

[MSN] The Treasury Department is easing sanctions against Venezuela's oil sector, allowing U.S.-based Chevron to pick operations up where they left off to comply with sanctions the Trump administration introduced in 2019.

Treasury’s Office of Foreign Assets Control issued a new general license on Saturday authorizing Chevron to resume "limited natural resource extraction operations" through its joint ventures with state-owned oil company Petroleos de Venezuela, opening the door for a rekindling of the energy trade between the U.S. and Venezuela.

Here's what the easing of sanctions means:

WHAT IS CHEVRON'S FOOTPRINT IN VENEZUELA?
Chevron is a minority partner in five joint ventures with Petroleos de Venezuela, two of which were actively producing petroleum in 2019.

When sanctions were introduced, Chevron's share of production was around 35,000 barrels per day, although the joint ventures together have a capacity of upwards of 200,000 barrels per day.

For comparison, the operators in the U.S. are currently producing around 12 million bpd.

Production in Venezuela, a member of the Organization of Petroleum Exporting Countries, was around 700,000 bpd in October, according to OPEC data.

WHAT DOES TREASURY'S LICENSE ALLOW?
Treasury's license authorizes activities related to Chevron’s joint ventures but prevents Petroleos de Venezuela from receiving profits from the oil sales by Chevron.

It also prohibits the expansion of joint ventures between Chevron and Venezuelan entities, and prohibits the sale of petroleum "produced by or through the Chevron JVs for the exportation to any jurisdiction other than the United States."

IS THERE A MARKET FOR VENEZUELAN CRUDE OIL IN THE U.S.?
The U.S. imported more than 19.6 million barrels of crude oil and petroleum products from Venezuela in January 2019, the month former President Donald Trump ordered sanctions against Petroleos de Venezuela. Of that total, the Gulf Coast received some 88%.

"Gulf Coast refiners were basically built — a lot of them were built to take this Venezuelan crude, which is heavier," one oil industry source told the Washington Examiner. "It really helps the margin. So, when that stopped, it made conditions a bit more challenging."

Valero and Citgo are among the premier customers of Venezuelan crude oil. Both have multiple refineries on the Gulf Coast.

"I have not seen anything in public [from refiners], but I would think that, at least in private, I think it would help regionally getting that crude to the market," the person said.

WHAT ARE THE POLITICAL RAMIFICATIONS?
The Treasury Department said its easing up on sanctions was driven by progress in talks between the socialist regime of Nicolas Maduro and the opposition movement Unitary Platform. The decision "reflects long-standing U.S. policy to provide targeted sanctions relief based on concrete steps that alleviate the suffering of the Venezuelan people and support the restoration of democracy," the department said.

Republicans have taken shots at President Joe Biden for the decision. Former U.N. ambassador and prospective presidential candidate Nikki Haley said Biden "is willing to buy dirty oil from the brutal socialist regime in Venezuela" as opposed to "creating jobs and unleashing our energy."

National Security Council coordinator John Kirby, in the White House briefing on Monday, pushed back on a line of criticism suggesting the Biden administration is preferencing the Venezuelan oil sector to the domestic sector.

Kirby pointed to the several thousand approved applications for permits to drill currently on the balance sheets of federal lessees and said there “are plenty of opportunities for oil and gas companies to drill here in the United States."

White House officials and Democrats in Congress have frequently pointed to unused drilling permits to suggest companies have all they need to increase production.

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-Lurid Crime Tales-

US busts ring of Russians, Latvians and a Ukrainian attempting to smuggle US military tech to to Moscow arms makers - including device for building NUCLEAR weapons

2022-10-20

[Daily Mail, where America gets its news]

U.S. prosecutors have charged five Russian nationals for sanctions evasion

It includes the shipping of military technologies bought from US manufacturers to Russian buyers, some of which ended up used on the battlefield in Ukraine

Federal prosecutors said the electronic components purchased by Russian nationals included semiconductors, radars and satellites

The technologies can be used in fighter aircraft, ballistic and hypersonic missile systems, smart munitions, and other military applications

A German company was used to ship the military technologies, as well as Venezuelan oil, to Russian purchasers

The defendants used fake companies and submitted false information to U.S. banks, which processed tens of millions of dollars worth of transactions

Five Russians charged in global scheme to smuggle equipment from US for Russia's military

[FoxNews] The defendants also allegedly smuggled hundreds of millions of barrels of Venezuelan oil to Russia and China.

Five Russian nationals and two oil traders for Venezuela were charged this week in a wide-ranging scheme to obtain military equipment from the United States and smuggle Venezuelan oil to Russia and China, according to an indictment unsealed Wednesday in federal court.

The defendants allegedly used Nord-Deutsche Industrieanlagenbau GmbH (NDA GmbH) as a front company to purchase advanced semiconductors and microprocessors that have been used in various Russian weapons, including fighter jets, missile systems and ammunition.

"As alleged, the defendants were criminal enablers for oligarchs, orchestrating a complex scheme to unlawfully obtain U.S. military technology and Venezuelan sanctioned oil through a myriad of transactions involving shell companies and cryptocurrency," Breon Peace, U.S. Attorney for the Eastern District of New York, said in a statement on Wednesday.

"Their efforts undermined security, economic stability and rule of law around the world."

One of the defendants, 42-year-old Yury Orekhov, the CEO of NDA GmbH, is accused of traveling to the U.S. in 2019 to source parts that can be used in Russian fighter jets.

Some of the electronics smuggled through the scheme have been found in Russian weapons on the battlefield in Ukraine, according to the indictment.

"This network schemed to procure sophisticated technology in direct support of a floundering Russian Federation military industrial complex," FBI Assistant Director-in-Charge Michael J. Driscoll said in a statement.

The defendants also allegedly smuggled hundreds of millions of barrels of Venezuelan oil to purchasers in Russia and China.

Two oil traders, Juan Fernando Serrano Ponce and Juan Carlos Soto, brokered deals worth millions of dollars between Venezuelan state-owned oil company Petroleos de Venezuela S.A. and NDA GmbH.

The defendants used a complex web of shell companies, falsified documents and cryptocurrencies to route the transactions through U.S. financial institutions, according to the indictment.

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Caribbean-Latin America

Iran uses disguised tanker to export Venezuelan oil: docs

2020-12-15

[THEBAGHDADPOST] A tanker chartered by the National Iranian Oil Company (NIOC) is loading Venezuela

...a country in Central America that sits on an enormous pool of oil. Formerly the most prospereous country in the region, it became infested with Commies sniffing almost unlimited wealth. It turned out the wealth wasn't unlimited, the economy collapsed under the clownish Hugo Chavez, the murder rate exceeded places like Honduras and El Salvador. A significant proportion of the populace refugeed to Colombia and points south...
n crude for export, documents from state-run PDVSA show, providing evidence of the two countries’ latest tactics to expand their trade in defiance of U.S. sanctions.

Venezuela and Iran
...a theocratic Shiite state divided among the Medes, the Persians, and the (Arab) Elamites. Formerly a fairly civilized nation ruled by a Shah, it became a victim of Islamic revolution in 1979. The nation is today noted for spontaneously taking over other countries' embassies, maintaining whorehouses run by clergymen, involvement in international drug trafficking, and financing sock puppet militias to extend the regime's influence. The word Iran is a cognate form of Aryan. The abbreviation IRGC is the same idea as Stürmabteilung (or SA). The term Supreme Guide is a the modern version form of either Duce or Führer or maybe both. They hate ~~Jews~~ ~~Zionists~~ Jews. Their economy is based on the production of oil and vitriol...
have deepened their cooperation this year as Venezuela has exchanged gold and other commodities for Iranian food, condensate and fuel.

Names of scrapped vessels are being used by several PDVSA (Petroleos de Venezuela, S.A.) customers, including NIOC, to disguise the routes and identities of the tankers they use.

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Caribbean-Latin America

16 Tankers Are Stuck With 8.36 Million Barrels Of Venezuelan Crude That Nobody Wants

2019-02-27

Hat tip: gCaptain
Venezuela is running out of space to store its sanction-stained crude that few dare to buy, forcing it to reduce output at a time when the world is thirsty for heavy, sulfurous oil.

Tankers holding 8.36 million barrels of Venezuelan crude worth upwards of a half-billion dollars are floating off the country's coast as the nation struggles to find buyers for its oil following new U.S. sanctions in January. An armada of 16 ships holds cargoes belonging to state oil company Petroleos de Venezuela SA, Chevron Corp., Valero Energy Corp. and Rosneft Oil Co PJSC, according to shipping reports and ship-tracking data compiled by Bloomberg.

Oil ventures owned by PDVSA with Rosneft, Chevron, Total SA and Equinor ASA, whose upgraders convert tar-like Venezuelan crude into oil that refineries can process, reduced rates this week because they ran out of space to store crude, according to people with knowledge of situation. With few buyers willing to take PDVSA's oil, the alternative was to put some of that oil onto tankers to clear space and continue to operate at lower rates.

The backlog of ships and growing difficulty in keeping its oil upgraders running underscore the impact U.S. sanctions are having on PDVSA. Shipments to the America, once Venezuela's largest customer, have dried up. Without access to the U.S. financial system, on which many refiners and trading houses rely on to finance purchases, PDVSA is having trouble finding buyers outside of countries such as India and China, to whom it owes oil in payment for past loans.

The PDVSA-Rosneft joint-venture Petromonagas upgrader isn't processing oil after running out of space to store their production, a person with knowledge of the situation said. PDVSA-Chevron's Petropiar venture has reduced output for the same reason, other people said. Petrocedeno, a PDVSA-Total-Equinor venture, is running out of oil to process as a ban on sales of heavy naphtha to PDVSA has made it difficult to ship the heavy oil through pipelines from inland fields to the upgrader, another person said.

While Venezuela has been having a hard time selling its oil, the rest of the world struggles to find heavy barrels after Canada's self-imposed oil curtailment and OPEC supply cuts reduced the availability of the type of oil Venezuela produces.

The tightness in heavy oil supply translated into higher prices for Colombia's flagship oil Castilla, which competes with Venezuelan oil in the global market. Castilla for loading in March traded $4 per barrel less than global benchmark Brent, according to people with knowledge of situation. That compares with a discount of $9.80 for cargoes that loaded in February.
All that sanctioned heavy crude oil that nobody wants to touch.

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Caribbean-Latin America

Watching the money flee: Now China pulls out from Venezuela contracts

2019-02-02

Not just China. Lukoil too
[American Thinker] As they say in the news industry, follow the money. And the money in Venezuela, like a lot of Venezuelans, is fleeing.

Here's a new one from Rooters:

SINGAPORE (Rooters) - PetroChina Co plans to drop Petroleos de Venezuela SA (PDVSA) as a partner in a planned $10 billion oil refinery and petrochemical project in southern China, said three sources familiar with the matter this week.The company's decision adds to state-owned PDVSA’s woes after the United States imposed sanctions on the company on Jan. 28 to undermine the rule of Venezuelan President Nicolas Maduro. However, dropping the company was not a reaction to the U.S. sanctions but follows the deteriorating financial status of PDVSA over the past few years, said two of the sources, both executives with China National Petroleum Corp, the parent of PetroChina."There will be no role of PDVSA as an equity partner. At least we don't see that possibility in the near future given the situation the country has been through in recent years," said one of the executives, asking to remain unidentified because he is not authorized to speak to the media.

The Reuters sources say it's nothing to do with U.S. sanctions. But that, in the context of what the pullout means, is irrelevant: The Maduro dictatorship still loses the use of the money, or the oil earnings the money can bring. And the Chinese reasons are just as damning as if the whole thing had been about U.S. sanctions: Chavista fiscal practices, which have almost literally run Venezuela's once-vast oil industry back into the ground. The story signals that the Chinese have decided that right about now's a good time to finally cut their losses.

It follows a big Russian pullout move that does seem to be linked to U.S. sanctions:

Anatoly Kurmanaev✔
@AKurmanaev
Replying to @AKurmanaev

Lukoil is among about half a dozen oil traders who cut or suspended contracts with Pdvsa today, according to traders and a Pdvsa supply official. This threatens to leave the company without gasoline and diluent to move its crude.

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Caribbean-Latin America

Mass Arrests Paralyzes Venezuelas Energy Sector

2017-12-17

CARACAS/HOUSTON (Reuters) - Decisions at some joint ventures with foreign firms are delayed. A growing number of oil tankers sit idle because no one authorizes payments. Employees struggle to get approval for routine expenses, from taxis to training.

An alleged crackdown on graft in Venezuela, seen by critics as an effort by President Nicolas Maduro to consolidate power, has sown panic across the country’s energy industry and all but paralyzed state-run Petroleos de Venezuela SA, or PDVSA, according to people at the company and across the sector.

The ongoing purge, in which prosecutors have arrested at least 67 executives including two recently ousted oil ministers, now threatens to further harm operations for the OPEC country, which is already producing at near 30-year-lows and struggling to run PDVSA units including Citgo Petroleum, its U.S. refiner.

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Caribbean-Latin America

Venezuela's big oil purge: Auto-extinction of a socialist enterprise

2017-12-04

[AMERICANTHINKER] Powerful names in Venezuela's oil industry, people who've been in and out of the picture for years, went down like bowling pins in Venezuela this week. Nelson Martínez, Venezuela's chief of the state oil company, Petroleos de Venezuela S.A. (PDVSA), was one. Eulogio del Pino, the country's oil minister, was another. Whoever was acting director of Venezuela's U.S. refiner and distributor, CITGO, isn't there, either. A blurb from Nov. 29 says Asdrubal Chavez is now running the U.S. operation, and many of the CITGO officials are now detained in Caracas. Chavez is a cousin of Venezuela's late president, Hugo Chavez. Even the press contacts' names are now different.

It's tempting to see this move as a bold measure by the government of Nicolás Maduro to be doing something to improve things, given the parlous state of Venezuela's oil industry, whose inability to pump its OPEC quota has been described as a "gift to OPEC" (most of the other OPEC members cheat and pump more than they are allowed) and whose bonds are in default. Venezuelan oil output has dropped precipitously, falling below the 2-million barrel-a-day mark for the first time in 29 years.

An for sure, it's an oil industry plagued with corruption. But Maduro's men, the people doing the busting, are, if anything, more corrupt than the miscreants under arrest. Maduro's guys are the ones under U.S. sanctions for activities such as drug-dealing. The oil officials, rich and corpulent as they are, haven't been accused of that.

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Caribbean-Latin America

Venezuela Admits Mortgaging Citgo in the USA to Russia, Goes on Attack

2016-12-28

[LAHT] Venezuelan state oil company PDVSA admitted that it had mortgaged a 49.9% stake in the biggest three refineries it still owns outside Venezuela to Russian state-controlled oil giant Rosneft, after an article by the Latin American Herald Tribune exposed the transaction Thursday.

A 49.9% stake in the three refineries and the extensive U.S. pipelines owned by Citgo was "used to raise new financing", PDVSA said in a defensive statement.

Hugo's daughter needed some new baubles, you see...

PDVSA did not reveal what they received in exchange for the shares -- nor why it was kept secret -- but it is believed that Rosneft lent the Venezuelan state oil company $1.5 billion with the above mentioned stake in the Citgo refineries as collateral.

"Citgo is still owned by PDVSA", PDVSA's statement begins by saying, but later in the text PDVSA also admits that "in October it used as guarantee a 50.1% of Citgo in a bond swap operation." If PDVSA defaults,

...which it will...

Rosneft and bondholders could end up owning the refineries.

In short, the assets accumulated by previous Venezuela governments over 40 years were liquidated by "chavismo" in less than 10 years and with the proceeds disposed of in a manner not at all transparent.

Communism doesn't work. All else is mere detail. Socialism doesn't work a bit more slowly, but follows the same broad, pot-holed road to ruin.

"It is important to stress that any world class company, such as Petroleos de Venezuela, uses its assets to back its transactions and leverage its investments," PDVSA said.

Since 2005 onwards, PDVSA has also sold assets abroad other than refineries, such as pipeline companies, ports, terminals and storage capacity.

PDVSA's statement says the latest deal was carried out in the midst of "attacks from the press, but also during an adverse period for the world oil industry."

"PDVSA denies the media reports and comments based on speculation, rumors and biased information that discredit the Corporation made by spokespersons interested in generating political destabilization in our country," PDVSA said in its statement.

At the same time as it was confirming the secret deal, the monolithic ruling Chavista regime political party, the United Socialist Party of Venezuela (PSUV), went on the attack against LAHT, Russ Dallen and Redd Intelligence in an article called "Five Points that deny the sale of shares of Citgo."

"Beyond the recurring manipulation of anti-Chavez economists, journalists and politicians around PDVSA's financial operations, the decision -- ratified in an official communiqué -- to place shares of its subsidiary in the United States as a guarantee to improve its financial position is far from what other oil corporations are doing," the statement defensively begins, not mentioning that it only issued its "official communique" after LAHT's article dominated headlines.

Utterly adorable in their transparency.

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Caribbean-Latin America

Two Thousand Venezuelan Oil Workers Get Fired for Criticizing the Government

2016-10-23

[PANAMPOST] According to Manager of the Unified Federation of Oil Workers of Venezuela José Bodas, 2,000 people have been fired from the government-owned Petroleos de Venezuela (PDVSA) despite being under contract.

Venezuelan workers are continually intimidated and unfairly dismissed for political reasons, local news outlets have reported. Employers create fear and demand loyalty to "Chavismo" if they want to maintain their positions.

"The suspension of labor contracts is the subterfuge used by the ruling party in the oil industry to intimidate contracted staff in order to prevent the exercise of its constitutional and democratic right: the recall referendum," Bodas said.

The union leader also said that the company violates the Organic Labor Law requiring employers to hire them as permanent workers after a year of service. The government requires political loyalty, and if not, they terminate contracts.

"There are 26,000 workers hired for limited times with the promise that they will be incorporated into the permanent payroll if they are loyal to the government," he said.

PDVSA encourages outsourcing by contractors by lengthening worker contracts. This is prohibited by law because it is a practice with which employers commit occupational fraud.

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Caribbean-Latin America

Venezuela congressional probe says $11 billion missing at PDVSA

2016-10-21

[REUTERS] A report by a Venezuelan congressional commission accused Petroleos de Venezuela (PDVSA) [PDVSA.UL] of corruption on Wednesday, saying about $11 billion in funds went missing from the state-run oil company while Rafael Ramirez was at the helm from 2004-14.

It's been reported previously that Maria Gabriela Chavez, 35 and Hugo's daughter, has $4.2 billion in assets held in American and Andorran banks. Perhaps that estimate was low?

"It is more than the (annual) budget of five Central American countries," said Freddy Guevara, comptroller commission president and a member of one of Venezuela's hardline opposition parties, alleging widespread malfeasance at the state oil producer.

"We're talking about $11 billion they cannot justify," he added, as he presented a report by the legislative body that audits the state.

PDVSA, which manages the world's largest oil reserves, brings in about 95 percent of Venezuela's export revenues and has been the country's financial engine during 17 years of leftist rule in the OPEC member nation.

Critics have long accused PDVSA of corruption, but the company has maintained it is the target of a right-wing smear campaign, led by the United States and compliant international media, to sabotage socialism.

Neither PDVSA nor Ramirez, currently Venezuela's United Nations
...a lucrative dumping ground for the relatives of dictators and party hacks...
envoy, responded immediately to requests for comment on the report by the commission headed by Guevara.

Venezuela is engulfed in a protracted economic crisis exacerbated since 2014 by a sharp decline in world oil prices.

Raising the specter of default, cash-strapped PDVSA said on Monday it "could be difficult" to pay large looming debt commitments if a proposed $5.3 billion bond swap does not go through.

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Caribbean-Latin America

Some gas stations in Venezuela will accept Colombian pesos, U.S. dollars from 'Colombian drivers'

2016-10-05

[UPI] The governor of Venezuela's Táchira state has said some drivers next week could begin to pay gas stations with Colombian pesos or U.S. dollars.

Táchira Gov. José Vielma Mora said gas stations under the new currency program -- aimed at Colombian drivers -- will be jointly operated by Colombian companies and Venezuela's government-owned Petroleos de Venezuela, or PDVSA, oil company.

The announcement comes weeks after the regional government reduced the monthly allocated amount of gasoline for private use from about 3 gallons a month to 1.3 gallons, which has led some Venezuelans to stop using their cars or to seek gasoline through third-party gasoline providers at a higher price.

The governor said the gas stations can be paid in Colombian pesos or in U.S. dollars through a pre-paid card that will be handled by currency exchange operators or through public or private banks.

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Caribbean-Latin America

Venezuela Seeks Buyer for Citgo Petroleum

2014-08-01

Petroleos de Venezuela SA is seeking a buyer for Citgo Petroleum Corp., its U.S. refining and marketing company, in a deal that may be worth as much as $15 billion. PDVSA, as the state-owned oil company is known, "is currently seeking to monetize its ownership interest in us," Citgo said in a July 29 bond prospectus document. "There can be no assurance as to whether a transaction will occur or as to the nature or timing of any potential transaction."

Citgo owns three refineries capable of handling about 749,000 barrels a day in Louisiana, Texas and Illinois. The company sells gasoline through 5,600 branded stations. It could fetch $15 billion because its midstream storage terminals and docks are eligible for tax advantages, said Sam Margolin, a New York-based analyst for Cowen & Co. Potential buyers include Gulf Coast refiners looking to capitalize on the region's rising crude supply, and those operators seeking entry, Margolin said.

Citgo had sales of $42.3 billion last year and earnings before interest, taxes, depreciation and amortization of $1.8 billion. A call and e-mail to Citgo's Houston office weren't immediately returned. Argus Media reported July 24 that the company had received three offers of $10 billion to $15 billion for Citgo.

The government of President Nicolas Maduro probably is looking to sell offshore refineries to boost hydrocarbons exports to China, raise cash and reduce the risk of having assets seized as part of PDVSA lawsuits abroad, GlobalSource Partners' Ruth de Krivoy and Tamara Herrera said today in an e-mailed report to clients.

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