I’ve been getting that feeling of “someone is wrong on the internet!”
Since those events had press conferences and live TV coverage, the reporters feel obliged to file and editors obliged to run stories. In the meantime, with no headlines, we get this:
That is to say, the TDM Journal was nice enough to tweet out to us that Venezuela is being taken to international arbitration by Ternium over the nationalization of its Venezuela steel mill. Remember, Ternium was supposed to have had everything settled through negotiations by friends in high places in the Argentine government — several years ago. Apparently, something didn’t work out right, and here we are, with an Argentine company taking Venezuela to the World Bank’s arbitration panel.
(UPDATE: Nathan Crooks, now Bloomberg’s eyes and ears in the Venezuela energy and commodities world, points us to Ternium’s statement on the case, in their earnings report. Long story short, Venezuela made most of its payments but left Ternium hanging on the last $130 million. Ternium has promissory notes from Enarsa and Camesa, Argentina’s state oil and electricity companies, as collateral for the money, but for whatever reason hasn’t decided to cash those yet.)
Elsewhere in the historical record, look at how their binational chain of gas stations turned out. In short, big announcements followed by no action at all, and finally the ignominious abandonment of the project.
Or how about that Orinoco project we are hearing about on Fox Business as being newsworthy? Might I recommend a trip to the 2007 PDVSA annual report, page 59, where you see the same damn project, long since announced and even then on its way to the Memory Hole™.
And then there’s just regular business reality. Venezuela’s state oil company has no oil shale experience and no money to invest even at home, much less overseas. Venezuela’s state oil company has no deepwater exploration experience, and no money to invest at home, much less overseas. (Is there an echo in here?)
Venezuela has the world’s biggest oil reserves. It can’t get them out of the ground. Making agreements with Venezuela to help your domestic oil industry is like — jeez, honestly I am a bit stumped in trying to make an analogy here. Is there any other resource in the world that goes so completely un-exploited? It’s like making agreements with the US to help you reduce your carbon footprint, maybe. Or asking the Red Sox to show you how to win the World Series.
So these agreements aren’t news, ok? Thanks.