Archive for May, 2005

E-mail revoking visa of Supreme Court Chief

May 26, 2005

This is the mail that incensed the President of the Venezuelan Supreme Court and he gave a copy to the press. What is most interesting is that it is signed by the “Fraud Prevention Unit”. Why?

Note that it says the person should go to the Embassy to learn about a matter “of his interest”. Ominous! Again: Why?



Who betrays PDVSA? By Teodoro Petkoff

May 26, 2005

What hides between that entire supposedly nationalistic hullabaloo of Minister Rafael Ramirez? What are they trying to cover up with that rhetoric? It draws your attention that at the same time that they are accusing the so called “old PDVSA” (which obviously includes the PDVSA of Mandini, Ciavaldini and Lameda) of “treason to the nation”, in the “new” PDVSA plans prosper that without any doubt could provoke the collapse of the national oil industry.

It can’t be a coincidence that simultaneously they are working on the sale of Citgo, on the elimination of the production of Orimulsion and the ferocious questioning of the oil opening. These are three business areas of PDVSA that, if they are successful in the strategy that points towards their destruction, it will gravely affect our productive capacity and our presence in world markets. It can not be a coincidence that they want to get rid of a company like Citgo that seeing under the time horizon which is characteristic of the oil industry, which is decades, insures a significant participation in the most important of world oil markets, which is that of the US. It can not be a coincidence that they want to liquidate the production of Orimulsion, a product with growing demand and of high profitability. It can not be a coincidence the questioning of the oil opening, whose companies produce today more than a million barrels a day, almost half the crude the country exports.


Who would benefit from the collapse or significant reduction of our oil production? Without any doubt, all of the members of the reduced club of oil producing countries. All market spaces that Venezuela abandons or loses will be rapidly occupied by other producers. The Arab countries, with whom we share OPEC, would not vacillate, however, to fill any holes that Venezuela opens.


Neither would Russia or Mexico. PEMEX would not be unhappy to take some of the yanqui market that today belongs to Venezuela. Neither would, for example, Saudi Arabia. It is simply a matter of competing for markets.


In the high commands of the “new” Pdvsa there are some people who have theorized about these matters. Juan Carlos Boue, a Mexican, previously a high chief at PEMEX and today with high responsibilities at PDVSA, and Bernard Mommer, today Vice-Minister of Energy and Oil, after a number of years of apprenticeship at the Oxford Petroleum Institute, financed by a number of Arab producers of crude, have written about these topics, providing theoretical arguments to get rid of the “bad business” that Citgo would be and to close the plants of Orimulsion.


Nevertheless, at the same time that we advance in the destruction of the businesses of PDVSA with false nationalistic arguments, the Government issued the Gas Bill, that hands over 100% of the exploitation of gaseous hydrocarbons to multinationals, on the basis of which, they have established themselves in the delta platform. While the decibels of the pseudo patriotic speech go up, we go back to the policy of concessions in the Gulf of Venezuela. Some thirty multinationals are fighting for the space.


Are these contradictory conducts and the shady negotiations that are behind them what Minister Ramirez wants to mystify with the hollow loudness of his speech yesterday?

Some remarkable things I heard today

May 26, 2005

US Embassy’s Stephen McFarland: “The US Government has not received any request for the extradition of Luis Posada Carriles…we have only received a request for his provisional arrest’

Cool! Threaten to break relations, blame the US for damaging relations, promote rallies to ask that Posada be extradited and you have not even submitted your request! Once again, the opposition was wrong; the Government did not act efficiently in this case either!


Chief Justice of the Venezuelan Supreme Court Omar Mora: “I demand an explanation for my visa to the US being cancelled…I don’t want to say it was because it was the Court he presides that requested the extradition of Posada Carriles


How can he think that, there has been no extradition request! He also complained the US made it public by sending it to the airlines. He should sue himself for appearing on TV and telling all of us. Hold it! Can the Chief Justice sue himself? Why does he want to go to the evil Empire anyway? Disneyland? Las Vegas? Check his bank accounts?


Hugo Chavez: “We are going to reactivate the nuclear project of my General Marcos Perez Jimenez


Interesting that he would call “my General” the last Dictator we had, who was a bloody, fascist, right wing Dictator.


Rafael Ramirez: “We could not find any of the documents…in the official archives…the Ministry and PDVSA. Only one possible outrageous conclusion was possible: Someone made a point of gathering them and disappearing them


Oh! It is the old “hairy hand argument” so common in our history. Whoever did this had a long reach, it even disappeared the documents at the Assembly controlled by the….Chavistas!


Prosecutor’s Office: “We are opening an investigation against webpage, among other things for defaming people


Wow! It took a year to do anything about Tascon’s list, but in a day the Prosecutor opens an investigation on a page that may be defaming people who are pro-Chavez for calling them Chavistas. I think they are right, this is worse than Tascon’s list; they are calling you a Chavista in public and revealing who you are! Nothing like a very private Chavista! This is defamation; they are encouraging people to hate them! The guy who asked for the investigation is being accused at the webpage of “being Chavista and organizing without success groups to take over Fedecamaras” or something like that. Really nasty stuff indeed!


Central Bank Director Maza Zavala: “I am no detective to know what PDVSA did with the foreign currency…it is a simple arithmetic operation”.


You have to give credit to the “father of Venezuelan Marxist economics”. He is certainly a man of principles and a relentless critic of the way the Chavez administration is running the economy. Notice he says “it is a simple arithmetic operation” to know some funds are missing.

PDVSA at the National Assembly: A smokescreen to hide the deterioration of the company

May 25, 2005

Today, at last, the President of PDVSA and Minister of Energy and Mines went to the National Assembly to discuss PDVSA. The whole thing was a travesty. First of all, the Chavez majority in the Assembly limited the discussion to the operating agreements and the oil partnerships, rather than talk about the problems of the whole company. Then, the Assembly was surrounded by Ramirez’ “supporters” who were bused in to chant slogans around the Assembly building (I am sure that was funded with Government money) and finally, the whole Board of PDVSA and Vice-Presidents were there, leading some to ask who was minding the store.

But I digress.


Ramirez began with the usual political speech about the previous Governments, selling out the company, underpayment of taxes, a serious investigation has to be carried out to find those responsible and all that. And then, he began making specific accusations and I just sat there in disbelief at what he was saying and which cases he brought up.


He first noted that the worst offender was a company named Sincor. Sincor is a heavy oil partnership in which French company Total has 47%, Norway’s’ Statoil has 15% and PDVSA has 38%. Sincor processes heavy crudes and makes lighter synthetic crudes.  Ramirez charge against Sincor? That the company was producing twice as much oil as it had approval for. Ramirez called for an investigation of all these cases and determine who was responsible. Well, in the case of Sincor you have to look no further than…Ramirez himself!


You see, while Ramirez made it sound like the “old PDVSA” versus the “new PDVSA” or the old Governments versus the new one, in the case of Sincor he is more responsible than any Minister of Energy (or Oil as it is called today) or President of PDVSA than any before him can be blamed.


Sincor was a project that was indeed approved by PDVSA during the Caldera Government in 1997. But when Chavez took power in early 1999, Sincor had yet to produce a single barrel of synthetic crude. In fact, the first barrel was actually produced in 2001, but it was not until 2003 that Sincor went up to its original full capacity of over 100,000 barrels of oil a day. At that time Ali Rodriguez was President of PDVSA and Ramirez was already Minister of Energy and Mines. Then, on October 9th. 2003, the Deputy Minister of Energy and Mines Luis Vierma, a Chavista brought over form PDVSA, announced that Sincor was going to increase production by 100,000 barrels a day. Then, seven months later, on May 19th. 2004 (last year!), a spokesman for French company Total said that the company would invest US$ 200 million to expand capacity to 214,000 barrels a day. Then eight months ago, on Sept. 30th. 2004, Sincor announced that it was shutting down its plant for 48 days to expand capacity. Then last Dec. 8th. 2004, the company announced that it was restarting the plant to produce 214,000 barrels of oil a day.


Thus, you have to ask:


1)      The expansion was public, announced by the Vice-Minister of Energy, when Ramirez was Minister,  repeatedly announced by the company, but neither the President of PDVSA nor the Minister of Energy knew anything about it?

2)      PDVSA owns 38% of Sincor. Doesn’t it have members on the Board of Sincor? Did they know about the expansion? Who are they? Have they been fired? Are they the same ones as when Chavez got to power in 1999? Are we to believe that in seven years, the Chavez administration did not change these people on the Board? Are these people independent, i.e. Do they report to no one at PDVSA?

3)      When Chavez became President he named oil industry veteran Mandini, who was pro-Chavez, as President of PDVSA. A year later, he named Hector Ciavaldini, an ardent Chavez supporter who had been fired from PDVSA for not working and whose level was way below Executive level, to the Presidency of PDVSA. Ciavaldini was the company’s President when Sincor produced its first barrel of processed oil. Then came Guicaipuro Lameda, Gaston Parra, Ali Rodríguez and now Ramírez. Are we to believe that during all this time, nobody mentioned, discussed, talked about Sincor or know what it was, how much it produced or how much it had authorization for? The Board never discussed the company or ask what it was? If true, who is at fault? The pre-1998 administration or the current one? Sounds to me that if they did not know about it, they are terrible managers or are so improvised that they had no clue about what they were doing and is taking them this long to figure it out.


So, if you carry out an investigation, who is responsible? Those that approved a certain project many years ago or those that allowed it to exceed parameters or were ignorant about them or did not even read the newspapers or listen to their Vice-Minister’s talk about it?


But let’s move on to the second of the three cases discussed. Ramirez also charged that Citgo may have overpaid US taxes and PDVSA is carrying out a study. Now, notice the “may”. Is that a serious and responsible charge? He did not say why it may have overpaid, he just stated it may have. So I ask again, Chavez has named six Presidents of PDVSA in seven years and it is only now that they realize this? Who is responsible? Will they prosecute the Chavista President’s too? Including Ali Rodriguez?


Finally, Ramirez said the operating agreements were illegal and information was withheld from Congress on these agreements and “today” the truth would be known. Well, I did not hear any “new” truth, but I have to ask: The former President of PDVSA Ali Rodriguez, who was President of the company since April 2002, made a career out of attacking those operating projects. In fact, he owes his career to them. Other than being in the guerrilla’s he was not known for anything else. He was the one that led the suit to the Supreme Court in 1997 asking that the agreements be declared illegal. So we are supposed to believe that Rodriguez was President of PDVSA for almost three years and never inquired about them, nor managed to prove that they were illegal and it is only today that they found out how? (But we are not told why?)


But even more interesting, why did the Chavez Government rush to sign agreements under the same conditions as the those he now calls “unpatriotic”, right before the new hydrocarnos law was approve?This inluded a new twist in the fact that any arbitration would be resolved by international courts and not Venezuelan ones, as proposed then by the opposition?


All of this is to me simply a smokescreen. They are trying to create and build scandals and make noise to distract people from the real and very serious problems at PDVSA. It is not whether the foreign companies pay or not taxes (That is the tax office’s job, not PDVSA’s), or whether Sincor produces more or not (The Ministry announced it!), or whether the agreements are legal or not (This Government signed similar or worse ones!). The whole point is that PDVSA is producing less and less and they know they are responsible for the deterioration. They have to hide it until they can figure out how to produce more and save their reputations and in the end…that of the Chavez Government. If not, they will be known as the people that managed to destroy PDVSA. What a revolutionary legacy!


(Meanwhile Saudi Arabia’s Aramco is making a recruitment trip to Venezuela to hire Venezuelan oil workers, who are even banned from working for companies that do any work for PDVSA)

What the hell is this? by Teodoro Petkoff or The Tascon list is still alive

May 25, 2005

What the hell is this? by Teodoro Petkoff in Tal Cual

Bury the Tascón list? What a farce! I am writing this mini-report on the bases of information I received a few minutes ago from an economist that applied for a position at the Central Bank. She brought all her credentials and her CV.


Yesterday, the person in charge of handling personnel matters at the Central bank informed her that her credentials were impeccable but unfortunately she had not passed the “citizen aptitude” test. Surprised, the economist pointed out that she had had no problems with the law. “No, it is not that” her interviewer told her. “The citizen aptitude test has to do with you know”. No, I don’t know, what are you talking about? Demanded the economist in question somewhat astonished. From the other side, the verbal answer continued being mysterious and evasive: “You know that thing” but the hand made a gesture of signing. The economist understood. She had signed and at the Central Bank they had consulted, obviously, the miserable Tascon list, where her “citizen ineptitude” was registered. This mini-reporter, that personally knows a number of Directors of the Central Bank, is addressing them by their names: Tell me Gaston Parra, tell me Armando Leon, tell me Prof. Maza Zavala, tell me Jose Felix Rivas, tell me Bernardo Ferran. What the hell is this? Are you going to accept that in the Institution you direct commit this type of dirty tricks?

PDVSA becoming normal: An ordinary Venezuelan Government institution

May 24, 2005

Today I was at work and there was a TV on and I caught a phrase from the announcer who said “The MVR Deputy said that proof that things were normal in PDVSA was the announcement that PDVSA will hand over its reports to the SEC by the end of June”

Now, I could not believe my ears. I did not get the name of the Deputy who said this but I was completely flabbergasted that any thinking human being could have made such an idiotic statement. If anything, the announcement proves something does not work well in PDVSA. In fact, you have to wonder whether they want Posada Capriles so he can help them out with PDVSA’s financials. With his experience at the CIA or Venezuelan intelligence (sounds almost oxymoronic!) I am sure he could help them forge here and there.


But hey! Who am I to judge? Let’s look at PDVSA’s track record. The 2002 financials which were due in June 2003, were late. How late? Well, in a post on July 15th. 2003, I described how we were promised the 2002 financials weekly. In fact, in August of that year a joyous Minister of Energy and Mines even announced that they had handed them in, but it was the wrong report. They had only handed in the report for an affiliate, not for the whole company as required by SEC regulations. The whole thing was such a charade, that the Minister actually said that Venezuela should be “happy” and “proud”. But the whole thing was actually shameful. It was just another attempt to fool the people.


After that, we were told that it would be in August, when PDVSA would comply with the SEC. We even heard “We have until September to comply”. But August came and went. And September came and went. And it was not until October, four months late, that audited financials for PDVSA for the year 2002 were finally handed over to the SEC.


And things were so “normal”, that apparently nobody thought of that the 2003 financials had to be handed over too.  June 2004 came by, the “normal” deadline to hand over the financials to the SEC and nothing happened. If PDVSA had been a public company it would have been suspended. Then came one of the most bizarre transactions of the Chavez administration when PDVSA announced in late June 2004, that it would buy all of its debt. It was really strange, announcing a buyback at a very high price that would essentially bring the company’s debt to almost nothing, which did not make sense. The proposed explanation: Company Directors were protecting themselves from prosecution under Sarbanes Oaxley.


But see, it is now May 2005, and the financials are 11 months late! Is that normal? Obviously not. In 2003 they had the excuse of the strike, but these are now the 2003 financials for God’s sake! The same ones we were told in February that would be handed out in March. But it is now May. Quite normal? Only in the revolution.


But we also hear today, that the President of PDVSA has hired former Superintendent of Bank Simancas to get those financials done by June 30th. Good luck! I certainly hope they do, I want to see them and analyze them, but the whole thing is very far from normal. In fact, in my mind this simply confirms the fact that things are not well in PDVSA. Not well at all. Any company worth its salt has to be capable of being audited. PDVSA is simply joining the long list of dysfunctional Venezuelan Government institutions which are almost impossible to audit: Bandes, Banco Industrial Seguro Social, Centro Simon Bolivar, Fogade. I guess the Deputy is right, it is becoming normal, that is it is turning into what is  the ordinary, what is the norm in Venezuela.  God help us!

Venezuela goes nuclear and will build bicycles

May 23, 2005

This picture was released yesterday before Chavez’ Sunday program in which he announced a factory will be built with the Iranians to build bicycles in Venezuela. Immediately afterwards, Chavez talked about using Iranian solar technology and “starting” a Venezuelan nuclear program.



What does one thing have to do with the other? Easy, this is the third time Chavez announces a joint venture to build bicycles in Venezuela; the other two were with the Chinese and the Cubans. The point being that it is easy to make bicycles, but you need human resources and know how to make nuclear technology, but we have not been able to get going a single one of the earlier two bicycle factories.


Speaking of nuclear technology, Venezuela even has a nuclear reactor, which Chavez appears not to know  about, but it is not in use it is GE technology from the 1950’s, the control room was tubes and there was never money available to upgrade it. Thus, it has been converted into an irradiation plant.


There have also been groups that made solar panels and even sold some for remote applications. I believe there is still some work going on at the University of the Andes. But apparently Chavez knows more about Iran than about Venezuela. In any case, unless you go into the materials aspects of it, this is really about engineering and not research.


But as a scientist, I think there are other areas where money would be better spent. Particularly because the toughest part is always human resources and there are lots of areas in which the country has strengths like tropical diseases and biotechnology, so why not invest in it, rather than having many mediocre groups with no budget, maybe we can have one or two which are good and have good funding. But I guess excellence is not this Government’s forte. Or starting or finishing projects.

Loose Ends

May 22, 2005

I have been doing many things and lots of things have been happening, but I did not have the energy to write on them or it was not worth it. So here are the loose ends I might have written about if things were not so discouraging or if the stories were clearer but you should know about them:


1)      PDVSA tried to give “new” numbers on how much it has handed out to the Central Bank. They are different from earlier ones, simply introduce additional confusion and represent a confession that the law is being violated. But the law seems to be irrelevant by now.

2)      The judge that had issued an injunction and reversed herself two days later was removed by the Judiciary Inspector. Every time a judge rules differently than what the Government ones, they are removed. In this case, I still don’t see what got the Government mad if a new law was coming into effect at anytime that would have removed the effects of the injunction. To keep appearances, she was removed for a different case.

3)      Chavez wants to use Iranian solar technology. Does he know anything about all of the work done in Venezuela in the field? Does he know the landing lights in Margarita airport have solar panels since the 80’s?

4)      We were promised PDVSA’s audited 2003 financials again, this time for June. Should we believe it?

5)      Chavez called former Spanish Premier Jose Maria Aznar a fascist. The President of Aznar’s party called Chavez dumb and “disiquilibrated”.

6)      Interesting interview with a pro-Chavez Professor who was fired recently after being in the Government for six years as Head of the higher education sector. Best quotes: “You can not give a degree to compensate a social deficiency…If there is something elitists and exclusive it is Cuban universities, that is why they are advanced in areas like health…There is a sector that believes that quality (in education) is a bourgeois concept…None of those programs has started”

7)      The Interamerican Human Rights Commission says Venezuela does not comply with Human Rights treaties alleging sovereignty.

8)      While the land grab by the Government continues in Venezuela with expropriations and no land ownership will ever (by law!) be given to individuals, Chacao Mayor Leopoldo Lopez presented in Chicago his project that gave land, so far, to the inhabitants of two large barrios in that municipality of Caracas.

9)      Through conversations I learn that while the Government is pushing cooperatives, workers in a cooperative can not form a union and get none of the labor benefits under Venezuela’s tough Labor laws.

10)  Lots of noise asking the Government to say something on the murder of Prosecutor Danilo Anderson or calls for the removal of the Prosecutors.

Equality under the Constitution, but not the law

May 22, 2005

I have been surprised by how little has been said about the fact that the new Penal Code maintains the discrimination against women when it comes t adultery, the new Code was rewritten, but should have been written to comply with all aspects of the new Constitution.

The new Venezuelan Constitution guarantees equality to men and women in its Article 21 which says: “All persons are equal under the law”. Not content with that, it continues in part 1 and 2 of that article:


  1. Discriminations based on race, sex, creed or social conditions will not be allowed…
  2. The law guarantees the legal and administrative conditions so that this equality under the law is real and effective…


Sounds pretty strong, no? Well, the recently approved penal Code keeps treating women and men quite differently and seems to reflect the machista society we live in. For example:


Article 394. The woman that commits adultery will be punished with prison of six months to three years. The same penalty will be applied to the coauthor of the adultery.


Notice that it does not say “and vice versa” at the end. It really says this is the punishment for women who commit adultery and if a woman commits it, the man she did it with will be subject to punishment. But it does not say it is a crime for a man to commit adultery.


That this is the case actually becomes quite clear in the next article of the law:


Article 395. The husband that maintains a concubine in the conjugal home, out of it, if the fact is well known, will be punished with prison of three to eighteen months. The punishment will produce de facto the loss of marital power. The concubine will be punished with prison of three months to a year.


So, these two articles together say. A married woman who commits adultery will be punished and so will her partner in committing the crime. For a man to commit a crime, the woman has to live in then home of the man or she has to maintain her in notorious fashion. Outrageous discrimination, no? Where are women and feminist groups? Where was the Attorney General? Where was the Cabinet’s lawyer (Who is woman)?


That this was the intent of the legislator is clearly expressed in Article 398, where it says that these crimes will be exempt from punishment when:


  1. In the case of the accusation by the husband, when the woman can prove that the husband had committed the crime specified in Art. 395, or had forced or exposed his wife to prostitution or incited or favored corruption.
  2. In the case of the accusation by the woman, when the husband proves that she too committed the crime described in Article 394.


To top it all off, if the accusing partner dies during the process or during prison, the punishment ends, possibly inducing all sorts of interesting criminal intrigues.


So my friends, if you are a married woman there is not much you can do. If you are a man, single or married, beware of married woman. And if you are a married man, don’t have a notorious concubine, or be very discreet. But single women or one night stands are really OK.


Women groups should take notice, no?

More satellite pictures of Caracas

May 21, 2005

As pointed out by Roglaf in the satellite picture I posted below, those pictures come from a NASA program you can download here:

I juts spent about three hours using it, it is easy to use once you get the hang of it. It is keyboard driven, so make sure to print the keyboard with the commands if you are going to use it. Here are two more pictures of Caracas without any processing, obviously the image I posted last week had some processing. I think the white can be either clouds in the mountains or areas with no vegetation.

Caracas from the South mountains are in front    From the north, you can see Vargas, the airport and behind the mountains Caracas