Venezuela To Take Over 39 Oil Industry Contractors

CARACAS, Venezuela (AP) — Venezuela's state oil company will take over 39 oil contractors with the backing of a new law, the government said 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 Monday after being published in the Official Gazette, the official Bolivarian News Agency reported.

It said the companies affected include Zulia Towing and Barge Company, Gusteca, Premeca, Seatech, and Terminales Maracaibo. The companies provide transport boats and other oil-related services on Lake Maracaibo in western Venezuela.

The National Assembly, controlled by allies of 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 Friday that his government was nationalizing some 60 companies as he oversaw the takeovers of boats, docks and other facilities on Lake Maracaibo.

The socialist president said taking over the assets of oil contractors will allow the government to cut oil production costs.

Venezuela's state oil company has recently 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 companies affected by the seizures include SIMCO consortium, which has worked injecting water into oil fields, and U.S. natural gas processor and distributor Williams Companies Inc., based in Tulsa, Oklahoma.