Venezuela backs Ecuador's decision to seize private oil facilities

Venezuela on Monday backed Ecuador's decision to seize oil facilities from Occidental Petroleum Corp. but said it had no plans to step in and fill the void left by the U.S.-based firm.

Photo: Venezuela backs Ecuador's decision to seize private oil facilities

"Oil-producing countries are taking control of their energy matters," Oil Minister Rafael Ramirez said at a news conference.

He said that the Ecuadorean government's decisions regarding Occidental's facilities were "sovereign, and we respect them."

Ecuador canceled Los Angeles-based Occidental's operating contracts last week and sent in troops to seize its assets, claiming the company had broken the terms of its contract.

Petroleos de Venezuela SA, or PDVSA, was among a list of state oil companies that Ecuador's public administration minister Jose Modesto Apolo later said Ecuador may partner with to operate the fields seized from Occidental.

But Ramirez said Monday the only issue Venezuela was evaluating at present was the possibility of refining some Ecuadorean crude since the country lacks refining capacity.

"That is the only area in which we are working," Ramirez said.

Occidental has produced about 100,000 barrels of crude daily in Ecuador, about 20 percent of the country's total output, and has invested about US$1 billion (Ђ0.78 billion) ince 1999 in its operations.

Ecuador's move comes amid a nationalist surge in the energy sector as governments seek a greater share of oil and gas profits. Earlier this month, Bolivia nationalized its gas sector and Venezuela has taken increasing steps to seek larger ownership stakes in its oil fields, as well as hike taxes and royalties paid by private oil companies.

Ecuadorean officials say the seizure does not mean the Andean nation is nationalizing its oil industry, reports AP.

O.Ch.