Economy
Venezuela's willingness to relax the conditions of the Carabobo Project improves the appeal of the bidding process, but it could be insufficient to offset the potential risk the oil companies have to assume when they decide to invest in heavy oil at the Orinoco Oil Belt.

President Chávez's administration has approved several changes, among them the first tax cut in 10 years, to attract bids for seven blocks that have interested different oil companies such as Chevron, BP and CNPC (from China).

The Ministry of Energy and Petroleum accepted to lower by 10 points the normal royalty of 30 percent and give more governance to private companies, despite the fact that the State will have the majority stake in the venture, sources told Reuters.

"The oil bidding, now scheduled for January 28, will have a much better chance to succeed under the new terms proposed, if confirmed," said Patrick Esteruelas a Latin America analyst with Eurasia Group in New York.

However, some analysts believe that despite government's concessions, some companies would refrain from bidding due to high legal risks involved and the huge investments required in the midst of the global financial crisis.