Venezuela Wants Exxon, ConocoPhillips Out

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Venezuela Wants Exxon, ConocoPhillips Out

CARACAS, Venezuela -- Discussions concerning compensation between the Venezuelan government and ExxonMobil and ConocoPhillips -- underway since late June -- have taken a turn, as the country's government wants the two oil companies to leave without compensation because they are refusing to come under state control, according to Energy Minister Rafael Ramirez, who was cited in a Forbes report.

The two U.S. oil giants refused to agree with a law passed by President Hugo Chavez's government, which forced multinational companies to give at least 60 percent of their capital in Venezuelan operations to the state-controlled Petroleos de Venezuela SA (PDVSA), the report stated.

“We are negotiating with the companies that have not accepted our laws in order to finalize their departure from the country,” Ramirez said earlier this week, according to the Forbes report. “We have been very clear since last year: quite simply, it does not interest us to work with companies that do not accept our laws.”

The minister added that the era of “oil openness is over,” and that no compensation would be given to the U.S. companies.

This is a change from mid-July, when Venezuela was negotiating in good faith to compensate the oil companies for their loss of assets, in hopes to avoid legal arbitration, CSNews Online reported at the time.

Ramirez noted earlier this week that those companies that do work with PDVSA would be allowed to stay in "the biggest oil reserve on the planet" for at least 25 years. Companies that agreed to the new terms include Chevron Corp., BP plc, France's Total SA and Norway's Statoil ASA.