Fausta's Blog

American and Latin American Politics, Society, and Culture

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Venezuela: The world’s worst oil company

Steve Hanke tweeted the graph on the world’s most miserable country,

To put PDVSA’s depletion rate into perspective, let’s compare it to Exxon’s. At the end of 2015, Exxon’s depletion rate was 8.15% — which is comparable to most of the world’s major oil companies. That rate implies Exxon’s median time to extraction (and sale) for a barrel of oil is 8.2 years. That’s 190 years earlier than PDVSA would realize revenue from selling a barrel of oil. Given the rate at which Exxon is depleting its reserves, they are worth something. Indeed, if we discount at 10%, Exxon’s reserves are worth 46% of the well-head value. Not zero, as is the case for PDVSA.

So, with the way PDVSA operates, it is exploiting reserves so slowly as to render them, on average, worthless. If that’s not bad enough, PDVSA is generating negative cash flows and piling up a mountain of debt (see the chart above). The arithmetic does not look good. PDVSA faces $10 bil. in interest and principal payments this year, but reports estimate that PDVSA only has $2 bil. in cash to service its debt obligations. In principle, the government could come to the rescue. But, its stated reserves have dwindled to below $10.5 bil.

Read the full article here.

Steel production is nil: Struggling to smelt, Venezuela state-run steelmaker grows sunflowers, crops

Workers at Venezuelan steelmaker Sidor are planting sunflowers and vegetables on company premises to ease a national food deficit as steel output has almost ground to a halt nine years after the company was taken over by the government.

In other headlines:
Congratulations Bolivarian Socialists, Venezuela Caught Up With North Korea

That’s according to the recent 2017 Index of Economic Freedom ranking, which places Venezuela in 179th position — next to North Korea, which occupies the 180th.

Published by the Heritage Foundation, the Economic Freedom report measures such things as trade freedom, business freedom, investment freedom, and the degree of property rights protection in 180 countries actually ranked.

Venezuela is also catching up with North Korea in corruption, while it is well ahead in inflation, which runs at 800%.

Lilian Tintori, Wife of Venezuelan jailed leader describes 3 years of torture

Peru’s president recalls envoy over attacks by Venezuela, after Nicolás Maduro referred to Peruvian president Pedro Pablo Kuczynski as a ‘coward’ and a ‘dog’ subservient to US, following PPK’s White House visit – the first by a Latin American president.

At the blogs:
How long is it going to take to crawl out of this hole?



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Venezuela: Protestors charge Chavez’s stage

Just as Chavez was droning on about some glass business with Uruguay, protestors climbed on his stage and disrupted his cadena (TV broadcast on all licensed stations in the country),

As you can see, first the sound was interrupted, then the protestors got on stage, and the program was interrupted.

The Real Cuba describes,

Chávez went to Siderurgica del Orinoco (SIDOR), Venezuela’s largest steel company, to meet with workers of the company, which he nationalized in 2009.
Now that the company “belongs to the workers,” according to Chávez, the workers have not been able to sign a collective working agreement with the real owner, the Chávez regime.
During the televised ‘cadena’ you could hear workers asking Chávez when will he sign new contract with them, since they have been working without a contract for two years.
You could see the dictator upset at the workers for demanding their rights. He told them not to hold any more outside protests, like those that have happened in the last few weeks when workers of SIDOR took to the streets and stopped traffic demanding a new contract.
And the protests from the workers kept getting louder and louder.
Then, when Chávez was talking about a new project for the plant, some of the workers tried to reach the podium from where the dictator was peaking and there was complete pandemonium.
First they caught the audio and you could not hear Chávez any more, you could see some of his military guards and Venezuela’s Foreign Minister Nicolás Maduro running to where the workers were and then after a few seconds you could hear the audio of the workers protesting while an image of the Francisco de Miranda dam was the only thing that could be seen and finally the ‘cadena’ went off the air without any further explanation.

The Devil’s Excrement also has video of a SIDOR worker asking Chavez yesterday why haven’t they been able to get a contract,

Chavez’s only response was that he couldn’t hear well because of the poor acoustics (!).

This is the first time workers (or protestors of any kind) have disrupted a cadena.

Which

This is the sort of thing that until now has only happened in Putin’s Russia, where the disenfranchised voters lash out in many ways.

Devil’s Excrement asks,

Is this a turning point in the campaign?

Meanwhile, the campaign is now trying to project a youthful Chavez with the logo “Chavez es otro beta“.

In some parts of Venezuela a beta is a news item, an issue, so, the point they are trying to make is?

According to the PSUV’s website [Chavez’s party], the word’s meaning evolved to “thing”, “issue”, and by using “Otra Beta” the concept becomes synonymous with “something new”, or a “change.”

Which comes to show two things:
a. the guy who’s been in power for 13 years is running on “change” since he can’t run on his record (oddly familiar, isn’t it?), and
b. obviously the Chavez campaign doesn’t read this blog.

UPDATE
Linked by Extranos alley. Thanks!


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