CARACAS, Friday September 14, 2007 | Update
The oil giant CEO Rafael Ramírez hailed increased social expenses as a major achievement (File Photo)
As crude oil prices are above 2006 level, the board of directors of Venezuelan state-run oil corporation Pdvsa estimates overall revenues this year are to exceed USD 100 billion, higher than USD 99.26 billion last year.
Rafael Ramírez, Pdvsa CEO and Minister of Energy and Petroleum, made the statement in Vienna, where he attended a meeting of the Organization of Petroleum Exporting Countries (OPEC).
"Figures so far this year are all right. Our investment budget -which exceeds USD 10 billion- has been executed in a 60 percent, and we think it will be fully executed. Further, costs and expenses are expected to fall, as we had a number of assets, including more than 4,000 inactive oil wells, that were not adequately accounted for in financial statements and were causing excess costs that were wiped out in year 2007."
Based on the schedule of the Oil Sowing Plan, in 2007-2008 Pdvsa's intensive investment projects are expected to start bearing fruits.
The conglomerate's overall assets climbed USD 10.16 billion, and they are expected to grow further, once they are re-worded in Venezuelan bolivars, according to the report provided by Pdvsa's trustee. "A study we ordered on the company's total value should be completed this year."
In different hands
For Ramírez, the fact that Pdvsa delivered 70.9 percent of its domestic revenues in 2006 to the Venezuelan State is a breakthrough. "This is exactly what we intend to do. We provided USD 39.20 billion in fiscal and social contributions, and we invested almost USD 6 billion in our businesses, which was double the amount we have been investing over the last few years."
Asked about the continuity of investments, as Pdvsa's consolidated net profits in 2006 fell short of USD 6 billion and the investments scheduled for 2007 exceed USD 10 billion, the official said "funds for investments have been earmarked and are guaranteed."
He did not show concern about a 15.9 percent drop in net profits in 2006, from USD 6.48 billion to USD 5.45 billion, despite booming oil priced. "Profits do not belong to Pdvsa. Old Pdvsa used to take profits to pay bonuses to managers. We are delivering profits to the State."
Further, he stressed that "international businesses do not make sense for a company such as Pdvsa." In 2006, the holding and its subsidiaries spent USD 58.67 billion to purchase crude oil, out of which USD 53.67 were spent by subsidiaries abroad. Purchases of Venezuelan crude oil and byproducts by Pdvsa's subsidiaries abroad in 2006 amounted to USD 19.89 billion.
"This sum was not higher because (Pdvsa's refining branch in the United States) Citgo cut the number of branded gas stations in the United States. The domestic financial statement reflects USD 5 billion in crude oil and byproducts, out of which some 30-40 percent was purchases of Brazilian ethanol and the remaining was purchases of crude oil from Petrozuata. This should be over in 2007."
Translated by Maryflor Suárez R.
02:57 PM. HEAVY RAINS. Venezuelan Executive Vice-President Elias Jaua reported that the government is designing plans to support farmers, cattlemen and peasants of the state of Mérida who have been hit by heavy rains that have caused crop losses.