Mérida, 26th March 2012 (Venezuelanalysis.com) – Venezuela’s state gas enterprise PDVSA Gas reached a compensation agreement with companies Wilpro El Furrial and Wilpro Pigap II over the nationalisation of their gas compression and injection plants.
The agreement, reached last Friday, stipulates that the Venezuelan state will pay 40% of the compensation up front and the remaining amount in equally paid quotas over four years.
The Venezuelan state simultaneously reached an accord with Wilpro’s owners, US transnational Williams Companies, to suspend the arbitration process initiated by Williams Companies against Venezuela in the World Bank’s Centre for Settlement of Investment Disputes.
The plants, located in Monagas state in the east of Venezuela, were nationalised in May 2009 with the promulgation of the Law of State Goods and Services Connected to Primary Hydrocarbon Activities.
At the time, Venezuelan President Hugo Chavez declared that the cost to the Venezuelan state over the previous decade of renting the installations was US $1.67 billion dollars, stating that the nationalisation would save the state around $54.4 million per year.
An official statement released by state oil company PDVSA regarding the agreement stated, “With the close of this operation, as much PDVSA as the Bolivarian Republic of Venezuela demonstrate their firm will to reach friendly agreements with foreign investors disposed to accept fair compensation for nationalisations”.