RE: As I predicted...Calif:
She corrected herself in this email that Statistic posted 4-26 on the private PFC DYDD discussion thread.
"As you know, the gas addendum has not been signed yet. At this time, we do not know if the gas production will be subject to the new royalties and tax rates. We beleive the Oil production under the existing contract will be converted to a Joint Venture with PDVSA and subject to new tax rates. Unfortunately, all these proposed changes have only just been announced therefore, all the companies operating in Venezuela are awaiting for more details.
Anything else, please let me know. I will be out of the office visiting our Offices in the State of Falcon, but will be back Wendesday in the offfice and will be glad to answer then."
I think she is not their legal counsel and she doesn't relate the license to the tax regime. I don't think that oil produced under a noin-associated gas license should be covered. But we'll see. Obviously noone in Ven should be interested in my opinions.
Chavez was in office when the 2001 non-passociated gas regime was put in place.
Also, do they want to put the World Bank loan and the next gas round in jeopardy?
The Venezuelian Tax Ministry already made clear that the announcement does not affect the heavy oil producers, who are also under a separate regime and has said there is a lot of confusion being generated by the annoucement. It only apllies to those 38 "oil" companies licensed before in the 90's before Chavez came to power. I don't think they meant PFC.
So we'll see. Maybe after the next bidding round. if you're a real skeptic?
Still a great set of properties with lots of cash flow ahead.