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Venezuela’s oil firm nationalizing 39 industry contractors

Venezuela’s state oil company will take over 39 oil contractors with the backing of a new law, the government said on Monday.

The 39 companies currently providing services to state-run Petroleos de Venezuela SA will be brought under government control under a resolution that took effect on Monday after being published in the Official Gazette, the official Bolivarian News Agency reported.

It said the companies affected include Zulia Towing and Barge Co, Gusteca, Premeca, Seatech, and Terminales Maracaibo. They provide transport boats and other services on Lake Maracaibo.

The National Assembly, controlled by allies of Venezuelan President Hugo Chavez, passed a law last week clearing the way for such takeovers as Chavez seeks to assert greater control over Venezuela’s oil industry.

Chavez said on Friday that his government was nationalizing some 60 companies as he oversaw the takeovers of boats, docks and other facilities on Lake Maracaibo. He said taking over the assets of oil contractors would allow the government to cut oil production costs.

Petroleos de Venezuela has clashed with domestic and foreign service providers that help extract the country’s heavy crude, accumulating debts as it aims to renegotiate contracts to reduce costs. The firms affected by the seizures include SIMCO consortium and Williams Companies Inc.

Also See: CPC seeks higher compensation for Venezuelan assets
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