Minister: 2002-2003 strike cost PDVSA US$12.8bn

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Wednesday, July 27, 2005

Venezuela's state oil firm PDVSA suffered losses and damages of US$12.8bn as a result of a 63-day strike that brought the country's oil industry to a halt from late December 2002-February 2003, company president and energy and oil minister Rafael Ramírez told reporters.

Ramírez quoted the figure from the company's 2003 financial statements, which were only approved by PDVSA's board on Tuesday. The company has long blamed the strike for loss of sales and damage to facilities as well as to certain mature oil wells, which needed constant injection of water, steam or natural gas to maintain production.

He described 2003 was "an atypical year because of the effects of the sabotage."

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Striking workers did more damage to PDVSA facilities than an occupying army would have done, Ramírez claimed. "Not even in Iraq" did the US armed forces carry out such destruction, the official said. "There's no political flag that can justify this."

In spite of a steep increase in oil prices, the company registered a decline in net profits to US$3.28bn in 2003 from US$3.54bn the previous year.

PDVSA workers went on strike as part of a national labor protest or what the government described as a "lockout" backed by much of the business community and aimed at ousting President Hugo Chávez. As a result the government fired 20,000 oil workers.

But former PDVSA executive José Toro Hardy disputed Ramírez's version of events. In an interview during the Napoleón Bravo show on the Unión Radio all-news radio station on Wednesday morning, he said that when workers walked out they handed over control of the undamaged oil installations to non-striking workers. "The damage was done when untrained workers tried to restart some facilities," according to Toro.

Venezuela is the world's fifth largest oil exporter with current production, according to PDVSA, of around 3 million barrels a day.