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Exxon, Conoco Pull Out of Venezuela

Firms reject Chavez demand for 60% stake in future projects

By Dustin Lushing,  Newser Staff

Posted Jun 26, 2007 8:04 AM CDT

(Newser) – ExxonMobil and ConocoPhillips are bolting from lucrative operations in Venezuela in the wake of Hugo Chavez's demand that his state-run oil company receive at least a 60% share in projects. Talks over compensation fell apart hours before today's deadline to determine the future of four projects that produce as much as a quarter of the country's daily output.

Chavez and Venezuela's state-run firm took operational control of plants in the region, including those built by Conoco and Exxon, on May 1 as part of the president's nationalization plan to create what he calls "21st century socialism.'' The projects in question represent about 4% of Conoco's 2006 production, Reuters reports, and 1% of Exxon's.

A pedestrian walks in front of a street banner depicting Venezuela's President Hugo Chavez and 'Guaky, the Copa America's pet, in Maracaibo, Venezuela, Monday, June 25, 2007. Venezuela is hosting the June 26-July 15 tournament, which includes the United States and Mexico as guests, for the first time in the...
A pedestrian walks in front of a street banner depicting Venezuela's President Hugo Chavez and 'Guaky", the Copa America's pet, in Maracaibo, Venezuela, Monday, June 25, 2007. Venezuela is hosting the...   (Associated Press)
In this image released by Venezuela's Miraflores Press Office, Venezuela's President Hugo Chavez, left, speaks holding a Russian-made rifle during a ceremony commemorating the Day of the Army and the battle of Carabobo, in Caracas, June 24, 2007 (AP Photo/Miraflores Press)
In this image released by Venezuela's Miraflores Press Office, Venezuela's President Hugo Chavez, left, speaks holding a Russian-made rifle during a ceremony commemorating the Day of the Army and the...   (Associated Press)
Gas prices in the northwest section of the District of Columbia are displayed at this Exxon service station Wednesday, May 23, 2007, in Washington. (AP Photo/Haraz N. Ghanbari)
Gas prices in the northwest section of the District of Columbia are displayed at this Exxon service station Wednesday, May 23, 2007, in Washington. (AP Photo/Haraz N. Ghanbari)   (Associated Press)
Venezuela's President Hugo Chavez greets supporters as he arrives for the inauguration of a new bridge that links Venezuela's capital with the country's main international airport and a major seaport in Caracas, Venezuela, Thursday, June 21, 2007. (AP Photo/Gregorio Marrero)
Venezuela's President Hugo Chavez greets supporters as he arrives for the inauguration of a new bridge that links Venezuela's capital with the country's main international airport and a major seaport...   (Associated Press)
oto/Andy Wong)
oto/Andy Wong)   (Associated Press)
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