During a meeting of the Council of Ministers held on March 2nd, 2021, Nicolás Maduro announced that he sent a package of 34 laws to the ‘new’ National Assembly to be approved or modified. Among the list of proposed laws to be modified, the government included, without any explanation, and, without saying anything about it, the reform of one of the country’s fundamental laws of the government of President Hugo Chávez: the Organic Law of Hydrocarbons.
The major international news agencies «celebrated» the step taken. They relate how, after the nationalization and control of oil was the center of the economic policy of President Chávez’s government period, now Maduro is determined to reverse what has been done and finally cede control of Venezuelan oil to the international private sector. The agents of the transnationals are in the antechamber of La Campiña, waiting for the feast.
Thus, Maduro’s government is preparing to take the most emblematic and concrete step of what professor Javier Biardeau called «transformism». I have been denouncing the above since 2017. After destroying our national oil company and yielding to private economic interests, the government has decided to hand over the country’s oil and gas.
I have been denouncing this government policy since I had evidence and evidence of where its actions in the sector are heading. My denunciation and utter rejection of the surrender of oil and the destruction of PDVSA have cost me persecution, exile, occupation of my house, violation of my image, honor and reputation, and all kinds of accusations against my family and me by Maduro and his Prosecutor. Time has continued to prove me right regarding Maduro’s motivations and objectives with his attacks against me and his viciousness against PDVSA.
Hydrocarbons privatization is the most significant concession ever made by Maduro to national and transnational capital to stay in power. This situation not only nullifies the national possibilities of getting out of the worst crisis in our history, but it is also the worst mistake that we may regret someday, that is why we must stop it in time.
In a reform that nobody knows about but is secretly circulating among the most conspicuous exponents of Madurism, through consultations with the country’s new businessmen and national and foreign economic power circles, the government is preparing to eliminate from the law. These provisions guarantee the State’s control over the activity, as established in Articles 302 and 303 of the Constitution. This reform is, in essence, the same that has been proposed by the extreme right-wing opposition in its «remix» of the ill-fated «oil opening». It is the central axis, the meeting point of the «dialogue» of Madurismo with the opposition and the country’s economic elites: handing over the oil.
Nothing new. Everything is about to turn PDVSA into a simple administrator of contracts, with minimal operative capacity, to hand over, in an open or disguised manner, the oil industry’s fundamental activities to the private sector.
OIL BELONGS TO THE PEOPLE
Oil is not only our primary economic resource; in fact, it is the most strategic and essential of our natural resources. Since the Nationalization of the Orinoco Oil Belt, on February 27th, 2007, during President Chávez government, we certified 316 billion barrels of proven reserves, mainly located in the mentioned area. Since then, our country becomes the largest proven oil reserve globally, with 20% of the total. This immense wealth belongs to all Venezuelans and our future generations.
When we nationalized the Orinoco Oil Belt and moved forward with the Full Oil Sovereignty policy, we were thinking and fighting for the present and the future of all. We were putting an end to the disastrous «oil opening», taking sovereign control of our strategic resources, placing oil at the service of the Venezuelan people, of their social development, of our economy.
President Chávez emotionally said, before more than 40 thousand PDVSA workers, gathered at the Jose Upgraders Complex, on May 1st, 2007, on the occasion of the Nationalization of the Orinoco Oil Belt:
‘Today we put an end to it, today we are closing a perverse cycle that was opened here more than ten years ago, a perverse process that they called the oil opening. We have buried today the oil opening, here in José Antonio Anzoátegui, in the Orinoco Oil Belt!’
The only reason why our country experienced an extraordinary period of economic boom and social development between 2004-2012 was because of the Full Sovereignty policy over our oil, and because Petróleos de Venezuela, the People’s PDVSA, was capable of exploiting and developing these immense resources in favor of the Nation and all Venezuelans.
It is appropriate to remember what President Chávez said in his speech before the National Assembly on August 15th, 2007:
‘Venezuela is going to grow, and will continue to grow in the economy; but no material wealth that we generate is going to be able to compare with the immense mass, the immense sea of heavy and extra heavy oil that we have at a thousand meters deep, there, north of the superb Orinoco River, that is one of the greatest riches in the world, which we have recovered, we have saved it from imperialism and from the privatization project.’
That oil was always there, in the subsoil, exploited in favor of transnationals or private entities. Meanwhile, the poverty and inequality that characterized our country during the whole 20th century keep growing. Their most tragic expression is the neighborhoods of the big cities and the abandonment of the countryside.
Only to the extent that the Venezuelan State was able to effectively control the exploitation and development of oil, and place its immense benefits in favor of the people, was the country able to achieve significant advances in infrastructure, education, health and welfare. Thanks to the revolutionary distribution of the oil income, during the Chávez government, we were able to fight against poverty and exclusion against economic and social inequality, guaranteeing «living well» and all Venezuelans’ well-being.
Oil is a public good, defined of strategic interest in the Constitution, imprescriptible and inalienable, located in the subsoil of our territory; that is to say, it is intrinsically linked to our sovereignty. Privatizing oil is like privatizing the Orinoco River, the Andes or handing over The Essequibo. It is the dismemberment of the Homeland, of our territorial integrity.
For this reason, since the Decree of Quito of 1829 by The Liberator Simón Bolívar and present in ALL the Constitutions of the Republic, including, of course, the current Constitution of the Bolivarian Republic of Venezuela, the oil belongs to the people of Venezuela and that its ownership, control and exploitation is reserved to the Venezuelan State through its national company, Petróleos de Venezuela, is enshrined.
This provision of the Constitution is developed and regulated in the Organic Law of Hydrocarbons, which the «new» National Assembly is now preparing to modify to repeal the mechanisms and provisions that guarantee that the State, through PDVSA, exploits and exercises effective control over the oil activity in the country.
It is more than symbolic that the approval and entry into force of this law, on January 1st, 2002, was one of the detonators of the violence of the economic elites and their parties against President Chávez and the Constitution, which would later be expressed in the Coup d’Etat of April 11th, 2002. It is paradoxical that the Law that Maduro wants to modify today, with the vote of the majority of the PSUV bench, is the same one that Carmona repealed in his coup decree, from the Ayacucho Hall, on that ill-fated April 12th, 2002. Will the head of the PSUV bench raise his hand against the country’s sovereignty, of the people, of Chávez and his legacy?
The law’s approval, which today the government intends to modify, was the fundamental reason for the Oil Sabotage violence of December 2002-March 2003. The opposition to this law mobilized the «oil meritocracy» of the old PDVSA against the Bolivarian government.
Maduro’s government is preparing to modify a Law which, for more than ten years, has proven to be extraordinarily effective in developing our oil resources under State control through PDVSA. It was a Law which, after its effective enforcement with the development of Full Oil Sovereignty, was accepted and respected by all the international partners of the sector, which kept working in the country as minority partners of PDVSA.
Our Organic Hydrocarbons Law effectively allowed us to reestablish our full operational capacities. PDVSA remained the fifth largest oil company globally, a state-owned company that in 2013 had 231.12 billion dollars in assets and 84.49 billion dollars in equity. Our Organic Hydrocarbons Law; furthermore, allowed us to reestablish the Oil Fiscal regime; and, thus entering to the National Treasury, between 2004-2012, more than 500 billion dollars from royalties and taxes, of which 240 thousand were destined to Social Development (Missions, Great Missions, social infrastructure) and the different Development Funds.
The Organic Law of Hydrocarbons, together with the Constitution, is the fundamental base of the legal framework for oil and gas in the country, and the legal basis that allows placing oil at the service of the collective interest, of all the people, of the whole country and not of the private interest, whether national or transnational.
THE WAVE OF PRIVATIZATIONS
The disastrous Maduro’s administration in all areas of the economy and the State’s management has been of such magnitude that the government has made the privatization of the country its salvation plank. Even worse, it has managed the delivery of all the State’s assets as a national «necessity»; it has done it in secret so as not to disturb too much its political and military support base.
This government policy is contrary to the public interest and our economic sovereignty, but also, it is illegal. Billions of dollars have been invested by the Venezuelan State for developing the strategic sectors of the economy to guarantee the interests of the people, as well as the supremacy of the State ruling the economy, to favor the objectives of our leading national development road map, «El Plan de la Patria».
Now, in a sad action reminiscent of the dismantling of the former Soviet Union during the government of Boris Yeltsin, the government of Maduro, just as the Russian president did at the time, is transferring the companies, goods and assets of the State in favor of its new «oligarchy», the economic and military power groups that sustained it in power.
Through different mechanisms, and, most of the times, acting de facto, the government has been privatizing the oil industry since the militarization of PDVSA in 2017 that brought the destruction of its operational capacities. The government has advanced in a de facto privatization of PDVSA through executive, illegal and unconstitutional decisions.
With Decree 3,368, dated April 12th, 2018, the then president of PDVSA, General Manuel Quevedo, was authorized to adjust oil contracts and agreements outside the legal and regulatory framework in force, which resulted in oil «Service Contracts» and the delivery of infrastructure and production facilities to third parties. Likewise, through Decree 3,569 of August 2nd, 2018, the tax exemption of oil operators and the assignment of PDVSA’s participation and control in oil operations in the Orinoco Oil Belt, the East and West of the country, in favor of its private partners, were authorized. During this period, oil and gas fields, facilities, drills, vessels, platforms, oil infrastructure, equipment, and companies have been transferred to the private sector and front men linked to the five characters that manage the country.
All the oil fields under PDVSA’s control between 2004-2012, in accordance with the Organic Hydrocarbons Law, have been handed over by Maduro’s government, between 2018-2021, to private management, leaving PDVSA as an administrative company. An agency or simple intermediary in the management of these contracts, now called «Service Contracts», trying to reissue in the worst possible way
However, contrary to what its ideologues and promoters have proclaimed, the government’s privatization wave has failed in a thunderous manner. Today, after the destruction of PDVSA and the private management of the country’s leading oil activities, PDVSA only exhibits the disastrous state of its facilities and the collapse of production, which is only 500 thousand barrels (a drop of 2.4 million barrels per day to 2013). Likewise, the refineries operate at 10% of their capacity. There is no money, no gasoline, no diesel, and no natural gas.
The same has happened in all areas of the national economy. The government has transferred lands, companies, factories and activities of the State to its power group, relatives, deputies, military, adventurers and «agents» now turned into «businessmen»: the new country’s owners. But the Venezuela of the delicatessen, hotels and luxury restaurants is worse than before, worse than ever, in an abyss.
With the so-called «Anti-Blockade Law» and now with its new National Assembly, the government intends to reform the Organic Hydrocarbons Law, to give a total and open turn to what was one of the top initiatives of President Hugo Chávez’s administration and the most critical element of his political legacy, his most significant victory: the Full Oil Sovereignty policy.
THEY PRETEND TO GIVE A LEGAL FASHION TO AN UNCONSTITUTIONAL ACTION
In order to advance in their plans, the government needs to change the current Constitution and modify Articles 302 and 303, as well as the values and principles enshrined therein; among them, that of SOVEREIGNTY to, only after that, be able to try to give legitimacy and legality to the changes they intend to make in the Organic Hydrocarbons Law.
The government of Maduro is preparing to do something that no other government in the country has ever done before: privatization, the handing over of oil to private, national and transnational capital. Only former dictator Juan Vicente Gómez did it and handed the country over to the transnational vortex, imposing the oil rentier model. Later, the PDVSA management, before Chavez presidency, tried it during the oil opening, with the already known economic and social effects, whose maximum expression was the «Caracazo» of February 27th, 1989.
What Maduro and his National Assembly intend to set is worse, not only due to the illegal and unconstitutional way they intend to do it, but because it goes against the national oil culture, since Juan Pablo Pérez Alfonso, Salvador de la Plaza, Isaias Medina Angarita and Rómulo Betancourt. And, of course, against the oil thinking and policy of President Chávez, his preaching and legacy, liquidating the possibility of reaching the historical objectives set in the «Plan de la Patria» and recovering the country’s sovereignty.
The government’s reasons go from treason, conspiracies, «the blockade and the sanctions», to «terrorist attacks». Yesterday, there was another alleged «terrorist attack» against a gas pipeline in Tejero, in Monagas, what we all know is another false positive. The gas and oil transportation systems have become time bombs and sources of permanent spills due to the lack of maintenance and the lack of expertise or errors in these complex systems that operate at high pressures.
The government, after destroying PDVSA, persecuting and imprisoning its managers and workers, and handing over the operations and infrastructure to the private sector, argues «that it must evade the sanctions by handing over the State’s assets to the private sector». That is to say, denationalizing the country is the spirit and purpose of the infamous law called «anti-blockade».
We should reflect on the strange effect that sanctions produce in the Maduro government: under the pressure of sanctions, the government responds by handing over everything it can. That is to say, unlike Cuba, Maduro’s government faced «sanctions» by surrenders everything, companies, assets, sovereignty. What a way this government has of «defending the Homeland».
In addition to the sanctions, the government now argues that «billionaire investments are necessary to recover PDVSA and the oil». Let Chávez be the one to answer Maduro and his ministers, recalling his words of August 31st, 2012:
«What did they (the transnationals) leave us: misery and hunger. That is the plundering and exploiting capitalism. And to make it a reality in Venezuela, imperialism always needed puppet governments, bourgeois governments, that there, in Miraflores, there should always be a puppet, an ass-kisser.»
«They wanted to present the issue (of foreign investment) to us as something unilateral, where, to receive foreign investment the sovereignty of the country had to be surrendered and, therefore, it was necessary to make it more flexible, the rationale that royalties should not be charged, taxes should not be charged, practically ceding the sovereignty of the country.»
MY PROPOSAL
We are convinced that neither the Constitution nor the Organic Hydrocarbons Law is the cause of the national oil industry’s serious problems, nor are they an obstacle to its recovery.
The fact that Maduro’s government has not been capable of managing or directing the oil sector, nor PDVSA, in seven chaotic years of persecution, the detour of resources and successive and severe errors in the management of the company, is not a reason to privatize oil and renounce to the reconstruction of the national oil industry. Those who claim otherwise are lying and protecting private interests, those who will take control of our immense wealth.
The myth propagated by the government and the private sector that PDVSA is irrecoverable is a huge lie, a scam, an excuse to commit the greatest fraud against the entire country. They all argue catastrophic scenarios, investments of hundreds of billions of dollars, technical and technological incapacity and long etcetera to justify the oil sector’s surrender, the privatization.
They forget that our country not only has the largest oil reserves in the world but that we have more than 100 years of accumulation of technical experience and development of oil infrastructure throughout the length and breadth of the national territory.
Our oil areas, the oldest and most complex, can be recovered. However, they require different treatment to address their current situation and their operational complexities.
From the West to the East, and, in particular, the Orinoco Oil Belt, we have operational areas with significant accumulations of oil that is there, on the surface. With proven reserves, existing infrastructure can be reactivated based on measures that solve in every area the affectation, after these years of disaster and abandonment.
But for our technicians, engineers and managers (we should free all those who are prisoners and call those of us who are exiled), there are no operational secrets, nor technologies that we do not know in the management of these areas or facilities. Our managers and engineers are the experts in Lake Maracaibo’s operations, North of Monagas or the Extra Heavy Crude of the Oil Belt, or those who know best the CRP, El Palito or the Refinery of Puerto La Cruz. They are not others.
What has happened in Libya is an excellent example of what I am saying. After years of war, bombings, foreign intervention and civil war, Libya’s production in June last year was barely 100 MBD, but after a government of national unity was achieved, production increased to 1.2 million barrels per day, as of February, recovery of 900% in only eight months.
To recover PDVSA, the country must enter into a new national, spiritual battle of mobilization and combat in favor of the country, without calculations, without pretensions other than rescuing the national industry. A spirit like the one that ignited in the workers and managers who joined us to recover PDVSA and the whole sector from the terrible consequences of the Oil Sabotage of 2002-2003, which brought our oil production to only 23 thousand barrels per day on January 1st, 2003, and which allowed us to recover it in only three months of hard, arduous, tireless work, with all the people, the whole country, joining in a monumental task.
We were already able to do it during the defeat of the Sabotage. We recovered all our operational areas, our sabotaged refineries, our facilities and control systems. With the full support of the State and the country, we can do it again, its political and social forces.
Although at this moment the damage to PDVSA is even greater than at the time of the Sabotage, the combined forces of all of us, and the need to win, that we have no other option, that we cannot surrender or abandon our country, is greater than any difficulty.
We must return to the way we did things with Chávez, with altruism, strength, patriotic love, dedication, work, study and much commitment and love for the country. The new Battle for the oil will also serve as a push, a boost, reinforcement of an attitude, values and conduct necessary for the spiritual healing of society: honesty, work, solidarity, dedication in favor of the country.
All our productive areas, all our refineries, all our facilities are recoverable. Each one at different times and with different intensities, there are no technological secrets, there are no frontiers of knowledge for us. I do not promise that we will do it in one time, but it will be a gradual, continuous recovery, supporting us in the most prolific and the least affected areas. Funding our needs with incremental production, charging what is due for our oil, without the gross discounts of more than 60% that are currently being granted, paying taxes and royalties, fulfilling our contracts and supply commitments to the large markets conquered during our diversification; and, if possible, supplying our traditional markets.
The international oil market will continue its recovery and requires our heavy and medium crudes. The world will continue to need oil for many more decades. Whoever wants to convince us that the oil era is over only wants to take advantage of our wealth.
The economic resources to recover our production are right there. We only need reasonable, manageable amounts, perfectly accessible for the country, to start a gradual recovery. To start recovering the infrastructure with all our national capacities, both those of the State and those of the national and international private sector, technological and financial, reestablish the supply chains and industrial support for equipment and services.
Precisely, the Organic Law of Hydrocarbons regulates how and to what extent these sectors’ participation in the activities reserved to the State is that our joint ventures are in force, the oil is there, and so it is the legal framework.
We will have to review each area or facility’s particular situations and make decisions within the strategic and unique objective of reestablishing our operational capacities and guaranteeing the country’s oil income, always maintaining our Full Oil Sovereignty.
THE OIL IS A POLITICAL PROBLEM, NOT A TECHNICAL ONE
To recover PDVSA, the oil production; and, therefore, to recover our economy, we must first reestablish popular sovereignty, the constitutional framework, and a legitimate, national, popular, revolutionary government, something opposed to the surrendering incapable and genuflecting government we have. It is imperative to solve the political problem.
We have proposed a Patriotic Governing Board to be approved within our Constitution’s framework through a consultative referendum, which must be promoted immediately.
With such a government, in a period of no more than two years, we can engage in a national battle to recover our oil industry and solve the serious economic and social problems of the country.
The above to be completed with a process of reinstitutionalization of the country, full liberties, freedom for political prisoners, workers and military prisoners, guaranteeing total respect for Human Rights and the country’s sovereignty. The Bolivarian National Armed Forces must fully assume their responsibility to guarantee our sovereignty and the validity of our Constitution and to accompany and protect the effort to recover the oil industry and the country in general.
OUR NATION WILL CONTINUE TO BE AN OIL-PRODUCING COUNTRY
Despite what this government says or does, the reality is that we will continue to be an oil country for many more decades, the oil is there, and the world will continue to need it. The big question is, in whose favor will this crisis be resolved?
We propose that this crisis has to be resolved in favor of the whole country’s people. The recovery of the national economy and the solution to the deep crisis and the serious social problems that afflict us must be achieved by recovering our oil industry, PDVSA as our State operator, the only way to recover the oil and the oil income in favor of the people.
If this is not done in this way, if due to political and institutional weakness, the country remains paralyzed, mute, before the pretensions of the government and its political factors to hand over the oil, then we will suffer a setback of 100 years in our history as an oil-producing country.
To give up our national oil operator, PDVSA, our great company, full of operational and technical capacities, a company that belong to all Venezuelans, would be a tremendous crime against the country, equivalent to dissolving our army. It would deprive us of the possibility of exploiting and producing our oil to put it at the service of the country, of our people.
If PDVSA is not taken back, the transnationals will once again rule our fields and take the oil as they always did. There will be a caste of politicians, military and sectors of a new bourgeoisie that will get rich with the crumbs they leave us, and the people will continue to be submerged in poverty and despair.
It is not the transnationals or any other private interest that works in favor of the country’s interests. They have their strategy, their interests, we have ours, our own development needs.
That is not the future we want for our people, our children, the children of Bolivar. After so many years of struggle and fight for our Oil Sovereignty and the welfare of the country, we do not deserve it.
Only oil, our oil, will be an effective tool to recover our Homeland, to reconquer our future, full of justice and welfare for all the Venezuelan people. It is the only possibility we have to get out of the abyss. That is why we must raise our voices louder and louder, without fear: NO TO THE PRIVATIZATION OF OIL!