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Mon, Aug 28, 2006 - Page 10 News List

Chad tells Chevron, Petronas to leave

GET OUT Chadian President Idriss Deby gave the two oil giants just 24 hours to start making arrangements for their exit plans while accusing them of not paying taxes


The president of Chad said that oil companies Chevron Corp and Petronas must leave the country, claiming they had not paid taxes. He said his country would assume responsibility for their oil production.

President Idriss Deby, speaking on state-run radio on Saturday, gave the companies, which have been part of the African country's oil production consortium that is led by Exxon Mobil, a deadline of just 24 hours to start making plans to leave.

"Chad has decided that as of [Sunday], Chevron and Petronas must leave Chad because they have refused to pay their taxes," Deby said in a message broadcast on state-run radio.

It wasn't immediately clear if the companies would be forced to leave by yesterday or if the deadline would be extended. It wasn't immediately known how many workers the two companies have in Chad.

Deby said that Chad, which is in the midst of setting up a national oil company, would take responsibility for the oil fields that the US and Malaysian companies have overseen. The oil fields account for some 60 percent of the country's oil production.

Sabri Syed, a spokesman for Kuala Lumpur-based Petroliam Nasional Berhad said he could not immediately comment on Deby's announcement.

Chevron issued a statement that said it was in compliance with its tax obligations.

"Chevron has not received any official notification from the Republic of Chad government asking Chevron to leave the country over tax issues," the statement read. "However, Chevron has been in full compliance with all of our tax obligations."

Mark Boudreaux, a spokesman for Exxon Mobil, said by e-mail that his company has "not been officially notified of any action by the government of Chad regarding Esso Chad or Exxon Mobil."

He said that Esso Chad, an Exxon Mobil affiliate, has not been asked to leave the country, either.

The production and export of petroleum in Chad are overseen by the Exxon Mobil-led consortium. Under the mechanism, Texas-based Exxon Mobil is responsible for 40 percent of the country's production, while Chevron and Petronas each have 30 percent.

Deby did not say why Exxon Mobil was not singled out.

The three companies agreed to finance a risky US$4.2 billion 1,060km pipeline to deliver oil from landlocked Chad to the Atlantic port of Kribi in Cameroon.

The companies agreed to invest the money after the World Bank gave the project its blessing and after Chad passed a World Bank-backed oil revenues law that required most of the money to be allocated to health, education and infrastructure projects.

From October 2003 to December last year, the consortium exported some 133 million barrels of oil from Chad, according to information compiled by the World Bank. Chad itself earned US$307 million, or about 12.5 percent, on each barrel exported.

Deby said Petronas and Chevron had made millions while the country's revenue was decidedly less.

"In less than three years of exploration, the consortium has achieved a benefit of about US$5 billion for an investment of US$3.5 billion, whereas our country has received only about US$500 million, which represents 12.5 percent," he said in a statement released to reporters after his remarks on the radio. "It is our conviction the incomes coming from our mining, minerals and other wealth should serve the development of our country for the happiness of our people."

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