Venezuela: The Spectre of Big Oil (original) (raw)
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Venezuela formally expropriated its hydrocarbon industry in 1975, through the nationalization law of that year. This law created Petróleos de Venezuela (PDVSA), a State-owned entity which carried out industrial and commercial activities for the next 15 years, without any participation from private entities. In the 1980s, Venezuela decided to develop the extra-heavy hydrocarbon reservoirs of the Orinoco belt and other geographical areas. Known as the oil opening, this new policy of Venezuela authorized PDVSA to enter into operating service agreements and association agreements or joint ventures with private companies. It also considered the adoption of economic incentivization measures designed to encourage investment, such as the reduction of the income tax rate and of the applicable royalty to private companies operating in the hydrocarbon industry via association agreements with PDVSA. Following this new policy of the Venezuelan State, Mobil Corporation entered into two joint venture projects with PDVSA in 1990: one to exploit extra-heavy crude in the Orinoco belt – the Cerro Negro project; and another to explore and exploit light and medium crude adjacent to Lake Maracaibo – the La Ceiba project. When Hugo Chávez became president of Venezuela in 1998, the fate of Mobil Corporation and other foreign investors began to change.
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Oil Gas and Energy Law Intelligence, 2011
Focusing on recent developments in the area of oil-gas-energy law, regulation, treaties, judicial and arbitral cases, voluntary guidelines, tax and contracting, including the oil-gas-energy geopolitics. For full Terms & Conditions and subscription rates, please visit our website at www.ogel.org. Open to all to read and to contribute OGEL has become the hub of a global professional and academic network. Therefore we invite all those with an interest in oil-gas-energy law and regulation to contribute. We are looking mainly for short comments on recent developments of broad interest. We would like where possible for such comments to be backed-up by provision of in-depth notes and articles (which we will be published in our 'knowledge bank') and primary legal and regulatory materials.
Fordham International Law Journal, 1985
At the end of 1982, Mobil Oil Corporation (Mobil) withdrew from its Libyan oil exploration and production concessions. Subsequently, Mobil filed an arbitration claim against the Libyan Government, alleging that government action had effectively destroyed the economic value of Mobil’s concession. This arbitration raises substantial questions of transnational contract law. Part I of this Note provides the factual background to the Mobil-Libya dispute and a review of the major issues involved. Part II discusses the right of a host government to set export prices. Part III considers whether a host government may take unilateral action even though the concession agreement includes a stabilization clause. Part IV examines the issue of “creeping expropriation.” Part V analyzes the effect of the doctrine of permanent sovereignty over natural resources on the issues raised by the Mobil-Libya dispute. The Note concludes that when an oil concessionaire continues to operate in the host state fo...