KEY POINTS:
Opec member Venezuela is drafting legislation to "nationalize" oil production, requiring the state hold a majority share in all oil contracts and oil companies working in the country.
Energy Minister Rafael Ramirez said the decision came after the failure last year to reach agreement with foreign oil companies on joint contracts for exploration and production in the Orinoco belt oil zone, despite ample opportunity to negotiate.
"Now, no more negotiations are possible," he said. "The nationalisation will be pronounced by law," which Ramirez said was being drafted and will set out the specific terms.
"We will assume majority control along the production chain from production to sales," he said.
The nationalisation was announced by President Hugo Chavez in his annual state of the nation address on Sunday.
Exxon-Mobil, Chevron, Conoco-Phillips, Total, British Petroleum and Statoil have operations in the Orinoco belt, where they operate in joint ventures with the state-owned oil company Petroleos de Venezuela (PDVSA) as majority partners.
Venezuela's constitution needs to be amended before such a law can be passed, however.
"Once the law is passed, we will be able to give details on the terms," Ramirez said.
"For now, we are calling on all partners to discuss with each the future of these strategic associations, which are extraordinarily profitable," he said.
The Caribbean country is the fifth largest exporter of crude oil in the world, and only Latin American member of Opec.
The United States is Venezuela's top client, purchasing 1.5 million barrels per day.
- AFP
