I find it remarkable that this type of article gets by the New York Times Editors. besides the many factual errors like production levels, area and the like, there is the fact that indeed Venezuela may have amazing reserves of heavy crudes, but funny how no mention is made of the Alberta tar sands, which may not have the reserves of the Venezuelan ones, but it may only be a factor of two off.
Business people are not brain dead. When they decide to go somewhere and invest, they run numbers, do risk analysis, then models and that determines where they will invest. So compare the conditions in Venezuela and Canada, which the people who wrote the NYT article appear to have no clue about neither of them, and you get:
Venezuela:
Breach of contracts.
No rule of Law.
PDVSA has to own at leats 60%
33% royalties
50% income tax
Breakeven point ~$25 per barrel
Canada:
Rule of Law
You may own 100% of the production company
Royalties of 1% until revenues generated are equal to investment, 16.6% after that
24-28% income taxes.
Breakeven point ~$12 per barrel
Yes, costs in Venezuela are somewhat lower, lower labor costs, fewer enviromental regulations, but the difference is simply not worth it. That is the reason why Canada’s heavy crude production is already twice the Venezuelan one and growing, while Venezuela’s is not epexcted to increase in the next two years.
The Devil's Excrement 
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