Identifier
Created
Classification
Origin
08CARACAS175
2008-02-13 21:51:00
CONFIDENTIAL
Embassy Caracas
Cable title:
PDVSA ANNOUNCES SUSPENSION OF COMMERCIAL RELATIONS
how-toVZCZCXYZ0025 PP RUEHWEB DE RUEHCV #0175 0442151 ZNY CCCCC ZZH P 132151Z FEB 08 FM AMEMBASSY CARACAS TO RUEHC/SECSTATE WASHDC PRIORITY 0588 INFO RUEHBO/AMEMBASSY BOGOTA 7681 RUEHLP/AMEMBASSY LA PAZ FEB LIMA 0952 RUEHQT/AMEMBASSY QUITO 2766 RHEBAAA/DEPT OF ENERGY RHEHNSC/NSC WASHDC RUMIAAA/HQ USSOUTHCOM MIAMI FL RUCPDOC/DEPT OF COMMERCE RUEATRS/DEPT OF TREASURY
C O N F I D E N T I A L CARACAS 000175
SIPDIS
SIPDIS
ENERGY FOR CDAY AND ALOCKWOOD
HQ SOUTHCOM ALSO FOR POLAD
TREASURY FOR MMALLOY
NSC FOR JCARDENAS AND JSHRIER
COMMERCE FOR 4431/MAC/WH/MCAMERON
E.O. 12958: DECL: 02/13/2018
TAGS: ECON EPET VE
SUBJECT: PDVSA ANNOUNCES SUSPENSION OF COMMERCIAL RELATIONS
WITH EXXONMOBIL
REF: A. CARACAS 168
B. BOWEN-DESK 2/13 E-MAILS
Classified By: Economic Counselor Andrew N. Bowen for reasons 1.4 (b) a
nd (d).
C O N F I D E N T I A L CARACAS 000175
SIPDIS
SIPDIS
ENERGY FOR CDAY AND ALOCKWOOD
HQ SOUTHCOM ALSO FOR POLAD
TREASURY FOR MMALLOY
NSC FOR JCARDENAS AND JSHRIER
COMMERCE FOR 4431/MAC/WH/MCAMERON
E.O. 12958: DECL: 02/13/2018
TAGS: ECON EPET VE
SUBJECT: PDVSA ANNOUNCES SUSPENSION OF COMMERCIAL RELATIONS
WITH EXXONMOBIL
REF: A. CARACAS 168
B. BOWEN-DESK 2/13 E-MAILS
Classified By: Economic Counselor Andrew N. Bowen for reasons 1.4 (b) a
nd (d).
1. (C) In the evening of February 12, PDVSA issued a press
release announcing that it would "suspend commercial
relations and the supply of crude and products" to ExxonMobil
in light of ExxonMobil's "unnecessary, intimidating, and
hostile" legal actions (reftel). PDVSA promised to "fully
honor existing contractual relationships pertaining to joint
foreign investments with ExxonMobil, while reserving the
right to end those contracts whose terms allow them to be
rescinded." ExxonMobil's Government Relations Advisor for
the Americas Milton Chaves (strictly protect) told EconCouns
via telcon from Houston that: "Over the past two years
ExxonMobil has imported an average of 30 thousand barrels per
day (Kbd) of Venezuelan crude for U.S. refinery operations.
Over the same time period Chalmette (a joint 50/50
ExxonMobil/PDVSA refinery operation in Louisiana) has
imported on average 75Kbd. Chaves thought that the suspension
would only affect the 30 Kbd of crude ExxonMobil was
purchasing for its own refinery operations. (Note: According
to the latest company-level import statistics available from
the Energy Information Administration, Venezuela sent an
average of 77.4 Kpd in November 2007 to the Chalmette
refinery; but showed an average of 93.8 Kbd to ExxonMobil
proper. If, indeed, only 30 Kbd is affected this is a
relatively insignificant amount for XM. The oil sent to
Chalmette comes from Petro Monagas, formerly the Cerro Negro
strategic association and whose expropriation led to
ExxonMobil's recent legal actions. PDVSA has a majority
ownership of Petro Monagas. End note.)
2. (U) Also on February 12, the National Assembly approved a
resolution that, among other points, urged the executive
branch to withdraw from the International Centre for
Settlement of Investment Disputes. During the afternoon of
February 13, Minister of Popular Power for Energy and
Petroleum Ramirez showed that the BRV is determined to see
this as part of a larger struggle with the United States:
"Nobody should be confused, this is not about a commercial
dispute, or a disagreement over economic issues; this is a
matter of one more step by North American imperialism in the
economic war they have against our nation and government, to
try to bring us to our knees."
DUDDY
SIPDIS
SIPDIS
ENERGY FOR CDAY AND ALOCKWOOD
HQ SOUTHCOM ALSO FOR POLAD
TREASURY FOR MMALLOY
NSC FOR JCARDENAS AND JSHRIER
COMMERCE FOR 4431/MAC/WH/MCAMERON
E.O. 12958: DECL: 02/13/2018
TAGS: ECON EPET VE
SUBJECT: PDVSA ANNOUNCES SUSPENSION OF COMMERCIAL RELATIONS
WITH EXXONMOBIL
REF: A. CARACAS 168
B. BOWEN-DESK 2/13 E-MAILS
Classified By: Economic Counselor Andrew N. Bowen for reasons 1.4 (b) a
nd (d).
1. (C) In the evening of February 12, PDVSA issued a press
release announcing that it would "suspend commercial
relations and the supply of crude and products" to ExxonMobil
in light of ExxonMobil's "unnecessary, intimidating, and
hostile" legal actions (reftel). PDVSA promised to "fully
honor existing contractual relationships pertaining to joint
foreign investments with ExxonMobil, while reserving the
right to end those contracts whose terms allow them to be
rescinded." ExxonMobil's Government Relations Advisor for
the Americas Milton Chaves (strictly protect) told EconCouns
via telcon from Houston that: "Over the past two years
ExxonMobil has imported an average of 30 thousand barrels per
day (Kbd) of Venezuelan crude for U.S. refinery operations.
Over the same time period Chalmette (a joint 50/50
ExxonMobil/PDVSA refinery operation in Louisiana) has
imported on average 75Kbd. Chaves thought that the suspension
would only affect the 30 Kbd of crude ExxonMobil was
purchasing for its own refinery operations. (Note: According
to the latest company-level import statistics available from
the Energy Information Administration, Venezuela sent an
average of 77.4 Kpd in November 2007 to the Chalmette
refinery; but showed an average of 93.8 Kbd to ExxonMobil
proper. If, indeed, only 30 Kbd is affected this is a
relatively insignificant amount for XM. The oil sent to
Chalmette comes from Petro Monagas, formerly the Cerro Negro
strategic association and whose expropriation led to
ExxonMobil's recent legal actions. PDVSA has a majority
ownership of Petro Monagas. End note.)
2. (U) Also on February 12, the National Assembly approved a
resolution that, among other points, urged the executive
branch to withdraw from the International Centre for
Settlement of Investment Disputes. During the afternoon of
February 13, Minister of Popular Power for Energy and
Petroleum Ramirez showed that the BRV is determined to see
this as part of a larger struggle with the United States:
"Nobody should be confused, this is not about a commercial
dispute, or a disagreement over economic issues; this is a
matter of one more step by North American imperialism in the
economic war they have against our nation and government, to
try to bring us to our knees."
DUDDY