The injunctions froze more than US$12 billion worth of assets of the Venezuelan state-owned oil company PDVSA in Britain, the Netherlands and the Dutch Antilles. ExxonMobil, parent company in Australia to Esso and Mobil, has also frozen $300 million of PDVSA funds held in a US bank account. “If they think that with this they will get us to backtrack on our nationalisation policies, well, gentleman from ExxonMobil, you are dead wrong again”, Ramirez declared.
As part of a drive to recover full sovereignty over its natural resources, the Venezuelan government of socialist President Hugo Chavez nationalised ExxonMobil’s 41.7% stake in the Cerro Negro project in the Orinoco oil belt in May last year with an offer for compensation. Other major oil companies including US-based Chevron Corp., France’s Total, Britain’s BP PLC, and Norway’s Statoil negotiated deals with Venezuela to remain on as minority partners in the Orinoco oil belt projects following the May 2007 nationalisations.
As well as ExxonMobil, US-based company ConocoPhilips also rejected the nationalisations, but has said it is seeking an “amicable resolution” with Venezuela. ExxonMobil, however, rejected an initial compensation offer from Venezuela and has demanded arbitration. Although the oil giant has not specified how much it wants in compensation, it said its investment in the project was valued at $750 million at the time the assets were taken over. The injunctions were solicited by ExxonMobil in anticipation of an arbitration ruling by the International Centre for Settlement of Investment Disputes over a compensation claim.
The court cases are ongoing, and the next hearing in London is scheduled for February 22. The Venezuelan parliament has passed a motion declaring the injunctions illegitimate, claiming it violates Venezuelan sovereignty using the argument that only Venezuelan courts should decide on issues relating to Venezuelan resources. Ramirez accused the US company of using the legal case to destabilise Venezuela, by creating panic over its finances.
The country’s dollar-denominated bonds have experienced their sharpest drop in six months because of fears the government could face a protracted legal battle. PDVSA is a crucial source of funds for the Venezuelan government’s social programs that provide free education and health care to the poor. In 2006, the company spent $13.3 billion on such programs, up from $6.9 billion in 2005. Ramirez said Venezuela was “being attacked by a transnational corporation”, and insisted that Venezuela would not back down from its policy of full oil sovereignty. He declared that “we are going to beat them in this battle”. During his weekly television show, Alo Presidente, on February 11, Chavez argued that ExxonMobil’s actions were part of a US government-backed “economic war” against Venezuela. “They will never rob us again, those bandits of ExxonMobil”, Chavez said.
He described the corporation as “imperialist bandits, white collar criminals, corrupters of governments, over-throwers of governments, who supported the invasion and bombing of Iraq and continue supporting the genocide in Iraq”. Chavez threatened that unless the injunctions were dropped, Venezuela would cease selling oil to the US. Venezuela accounts for 12% of US crude oil supplies, according to US energy department figures from November. Chavez said: “If the economic war continues against Venezuela, the price of oil will reach $200 [per barrel]. Venezuela will take up the economic war and more than one country is inclined to join us.” Nicaraguan President Daniel Ortega offered his support to Venezuela, claiming the moves were “a clear imperialist offensive against Venezuela”, and that Venezuela “can count on the unconditional solidarity and approval of the Nicaraguan people”.
On February 12, PDVSA issued a statement explaining that it was freezing all its business dealings with ExxonMobil in retaliation against the injunctions. The previous day, PDVSA instructed its traders to deposit oil receipts with the UBS bank in Switzerland in a move to protect its assets. The actions by ExxonMobil have been roundly rejected by the vast majority of Venezuelans, who rightly see this as an attack on their national sovereignty and right to control their own resources. Protests have been occurring all around the country, including by the oil workers at the nationalised Cerro Negro plant (now renamed Petromonagas).
On February 14, thousands of Venezuelans turned out in the rain at PDVSA headquarters in Caracas to reject Exxon’s imperialist aggression. Many people spoke of the need to mobilise against US aggression, to deepen the struggle for socialism, and to defend the democratically-elected Chavez government. Further demonstrations outside the US embassy have been called, and there are plans for massive mobilisations across Venezuela. Journalist Mari Pili Hernandez, who spoke at the February 14 demonstration, said the most significant thing was that for the first time in ExxonMobil’s history — since its origins as Rockerfeller-owned Standard Oil in the 19th Century — an entire country has stood up to the corporate giant.
There is a real sense of national pride in this defiance. There has also been a sense of anger among poorer sectors towards the reaction of the pro-capitalist opposition — based on the elite that governed Venezuela before Chavez came to power — who have largely sided with ExxonMobil in the dispute. The US-funded opposition have gloated over the freezing of PDVSA’s assets and blamed the government for its nationalisation policies — once again exposing them as lackeys of US imperialism, as well as revealing their hostility to policies that benefit the majority of Venezuelans. Luis Carvajal, a union leader at the Cerro Nero/Petromonagas plant said: “This transnational has exploited our wealth, our workers and violated our rights — all the workers in the Orinoco oil belt support the nationalisation.”
[Kiraz Janicke is a member of the Green Left Weekly Caracas bureau. This article is largely compiled from articles originally posted on Venezuelanalysis.com. The Australia-Venezuela Solidarity Network has produced an online sign-on statement in solidarity with Venezuela against ExxonMobil’s attacks, which calls for ExxonMobil to withdraw its legal actions.
The AVSN is also seeking to initiate an international day of protest against ExxonMobil and in defence of Venezuelan sovereignty for February 29. To sign the statement, and for details of protest actions, visit http://www.venezuelasolidarity.org/?q=node/2397.]
From: International News, Green Left Weekly issue #740 20 February 2008.