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Ecuador seizes control of US oil company

#1
Seems to be a pattern developing here!

Who is pulling the strings? Could it be Castro getting his last laugh, or could it be an other source?

Ecuador yesterday joined the wave of Latin American governments targeting foreign-owned industries when it fulfilled its threat against an American oil company and took "full technical control" of its operations.

The offices and installations of Occidental Petroleum were occupied by soldiers earlier this week, provoking a furious response by Washington.

But yesterday, a Petroecuador official announced: "We are in control of Occidental's technical operations."

State oil officials are expected to replace Occidental executives running oil fields in the Amazon region.


While the government of President Alfredo Palacio denied the seizure was part of a wider move to nationalise oil deposits in the Andean nation, the action follows a path blazed by the Leftist regimes in Venezuela and Bolivia.

Mr Palacio's government said that Occidental had violated the terms of its concession by selling part of its holdings to a Canadian firm in 2004 without Ecuador's approval.

Occidental is the largest foreign investor in Ecuador and had been pumping 100,000 barrels of oil a day from the affected field in the Amazon.
www.telegraph.co.uk
 
#2
I'm no expert on geopolitics, but, given there's beena mahousive lurch to the left in S.America, as can happen during economic turmoil, could we be seeing some sort of Latin America Warsaw Pact happening, with countries united not by a common goal but by a common (ideological) enemy, the U.S.
probably not but i do wonder

edited beacuse i can't type
 
#3
It appears to be a trend which will sacrifice long-term prosperity for a quick buck in the short-term, with leftie governments playing the easy yet puerile "evil multinational oil companies" and "evil USA" card. I do also suspect the hand of Castro at work.

If I owned an oil company operating in that region at the moment, I would seriously consider plugging my wells and getting out.
 
#4
Do these governments not realise that when they start nationalising industries it prevents further foriegn investment?

No oil company in its right mind will now explore or develop in that country (or bolivia) unless they can get in and out like a rat out of an aquaduct. Often state "compensation" if there is any is purely the cost of equipment, not the cost that went into exploration of that and the 1000 sites that didn't get developed.

As someone rightly said by nationalising they make a quick buck now, but they're screwing themselves over in the future.
 
#5
Some of the leaders in S.America are fuck1ng pysco's. I saw one yesterday, saying how if he was an Iraqi he would be "defending his country with a rocket launcher against the British and American empires" , he was goin on about how the world needs his country and not vise-versa, what happens when the oil runs out pal?
 
#6
Livin_on_a_prayer said:
Some of the leaders in S.America are fuck1ng pysco's. I saw one yesterday, saying how if he was an Iraqi he would be "defending his country with a rocket launcher against the British and American empires" , he was goin on about how the world needs his country and not vise-versa, what happens when the oil runs out pal?
Was that the one Red Ken invited around for tea? in the hope of getting some cheap heating oil?
 
#8
This swing to the left is in part blowback for the shabby way previous governments and the oil companies have treated the locals. From the point of view of the electorate in Equador if the oil companies squeal, who cares ? For decades they have taken all the profits out of the country leaving only the pollution. Now it's time to put that money not into huge profits for a multi-national but into the economy at home. They can threaten to take their ball home but no-one believes they will as long as Mr and Mrs Sixpack in the US want to drive their SUV. After all, (so the thinking goes) if we're currently not seeing any of the profits remain in the country who cares whether or not we keep pumping ? But without cheap oil the US has real problems. Ergo, ignore Washington whining as they need us more then we need them.

Elsewhere in the region, Venezuela may well be set on an unsustainable economic path but that does not matter to the majority of the electorate. What the locals see is - for the first time in their lives - they have free health care, cheap food and access to education. The doctors Chavez imported are Cuban, when one saves your child's life from something that the previous "US-approved" and oil company friendly government would have let them die from it will colour your political views somewhat.

Oh, and I'm obviously a psycho - as if I had a bunch of foreign soldiers at the end of my street I'd be out there with a rocket launcher too.
 
#10
crabby said:
Do these governments not realise that when they start nationalising industries it prevents further foriegn investment?

No oil company in its right mind will now explore or develop in that country (or bolivia) unless they can get in and out like a rat out of an aquaduct. Often state "compensation" if there is any is purely the cost of equipment, not the cost that went into exploration of that and the 1000 sites that didn't get developed.

As someone rightly said by nationalising they make a quick buck now, but they're screwing themselves over in the future.
Exactly my response. They equate foreign investment with imperialism, a idiotic and disastrous approach for any developing economy. It's one thing to prevent exploitation by foreign corporations and quite another to confiscate property outright.
 
#11
Livin_on_a_prayer said:
It was the president of Venezuela, I didnt know that propaganda goes that far up...
Yeah, thath's the one, Chavez. Already started down the old left-wing dictator road, though he's still popular at the moment, so he doesn't have any real threat to power yet. As soon as there is, you can bet he'll be stamping on the opposition, and declaring them to be 'fascists'.

Remember this is the Ken Livingsotne who invited round an apologist for suicide bombers, is proud that london's public transport is the most expensive in the world, and think that Mao's rule in china was overall OK.
 

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