CARACAS -- Venezuelan oil minister Rafael Ramirez yesterday applauded the return of state control over 32 privately operated oil fields with the start of the new year.
Ramirez said in a statement that Venezuela has successfully completed ''the recovery" of the fields, whose control was ceded to private hands in the 1990s under concessions allowing companies to independently pump oil under contract.
A deadline to agree to convert those operating agreements into joint ventures in which the state oil company Petroleos de Venezuela SA will hold a controlling stake expired at midnight Saturday.
The 32 operating agreements were signed during the opening of Venezuela's petroleum industry to private and foreign capital. The objective at the time -- when the price of crude was below $10 a barrel -- was to increase production at low-priority oil fields that were closed due to their location or a lack of resources.
As oil prices crept up, the government of President Hugo Chavez sought to boost its control and share of profits. In 2001, it passed a law requiring oil production to be carried out by companies majority-owned by the government. The government threatened to reclaim oil fields from companies that refused to sign the so-called transitional joint-venture agreements, which will later be converted into permanent agreements.
The 32 oil fields have been responsible for about 500,000 of Venezuela's declared production of 3.2 million barrels a day.