Petro-Canada Joins Oil Companies Abandoning Venezuela

Petro-Canada has decided to pull out of Venezuela and has reached an agreement with the state oil company on compensation for its oil investments, the Venezuelan government said.

Petro Canada
Petro Canada

Petro-Canada had partnered with Exxon Mobil, which is also withdrawing from Venezuela, in developing the La Ceiba block near western Lake Maracaibo. The block has not yet begun producing oil.

President Hugo Chavez's government has required all private companies to accept minority stakes in oil production projects and join state-controlled joint ventures.

Oil Minister Rafael Ramirez told a news conference Tuesday that state oil company Petroleos de Venezuela SA, or PDVSA, was unable to reach an agreement with Petro-Canada.

"Petro-Canada has decided on the culmination of its participation in its businesses in the country and compensation has been agreed upon between the companies that has already been accepted by both parties," Ramirez said. That compensation was not disclosed.

Petro-Canada and Exxon Mobil each had a 50% stake in La Ceiba but those shareholdings have passed entirely to PDVSA, Ramirez said.

Contact U.S. News


    Get the best of CNBC in your inbox

    › Learn More

Don't Miss

U.S. Video

  • Mad Money's Jim Cramer breaks down the theme of stealth technology stocks. Cramer says companies that are using proprietary technology to invent entirely new markets and then dominate those markets, fall under that category.

  • Mad Money host Jim Cramer knows it can be difficult to stick with a stock that is going lower but says if you've done the homework, and the story isn't wildly off the rails, then stay long.

  • Mad Money host Jim Cramer, outlines the most common emotionally driven investor mistakes and expresses why it is important to not let skepticism run away with you.