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Hugo Chávez’s eight year administration should be measured not by what he has done, but by what he has not done.

Many people are criticizing Chávez because he is claiming works like the Valles del Tuy-Caracas railway system, the subway line to Los Teques, and the bridge over the Orinoco River as his. However, these are petty criticisms. Every Government of the IV Republic hurried to inaugurate some work or another during an election year.

And it’s also very commendable that the Government allowed these works from the time of the IV Republic, designed to increase the quality of life of thousands of Venezuelans, to continue.

What does merit criticism are the important projects that the Government has pushed aside, as it did with the Christopher Columbus Project, on the Paria Peninsula, and the Oleofin Plant Project, in Jose.

On the one hand, the Bolivarian Government changed all the conditions concerning the commercialization of gas; thereby forcing Exxon Mobil, Royal Dutch and Shell to get out of the Cristóbal Colón Project, which contemplated a number of important developments with gas, like liquefying and transporting it to be sold in the Northern markets. It also “restructure” the project searching for supposed “savings,” along the lines that it changed its name to “Gran Mariscal Antonio José de Sucre” in a first feeble attempt to erase the name Columbus from collective memory.

On the other hand, the Oleofin Plant Project, which was supposed to be installed with all the know-how, state-of-the-art technology, and benefit from Exxon Mobil Chemical’s markets, was downsized. In this case, PDVSA stopped its on-going negotiations with Exxon in order to associate itself with the Brazilian company Braskem that has much less experience in this field. Now, the Oleofin Plant projects stands at “we’ll see.”

Meanwhile, not only did Exxon Mobile move the natural gas project to Qatar, from where it is already exporting 2 million tons of liquefied natural gas to the US, but this week it also signed a letter of intent there, to build an oleofin plant where they intend to produce 1.3 million tons a year of ethylenes, oleofins, and glycols; which is to say, the Venezuelan project moved to the Persian Gulf.

But, the worst case of “not taking care of business” that this Government has perpetrated, is to not have followed-up with the Orimulsion, to produce improved oil and/or mixtures. There is no viable excuse for this, since Venezuela has reserves that will last more than 200 years, allowing it to simultaneously produce the three hydrocarbons. What’s more, Orimulsion is profitable, no matter how much the Government insists that it isn’t: For the first quarter of 2005, Orinoco bitumen was being sold (the bitumen content in the Orimulsion) at $22/bbl.

These are just three “golden” opportunities that explain why Chávez’s Government should be measured not by how much it has let continue to develop from the IV Republic, but for all it has stopped doing.

VenEconomy is a Venezuela's leading specialized publisher in the economic and financial area. VenEconomy's Points of View on the issues of the day, as seen by VenEconomy during the last week. Petroleumworld not necessarily share these views.

Editor's Note: This commentary was originally published by VenEconomy, on 10/18/2006. Petroleumworld reprint this article in the interest of our readers.

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Petroleumworld 10/23/06

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