Economy
June 29

Argentina renegotiates with Venezuela delayed payments for fuel oil
During the last two years, Argentina failed to pay Venezuela debts related to fuel oil shipments that were imported by Cristina Kirchner's administration to alleviate a gas shortage in the South Cone country. Therefore, the government of Argentina was forced to renegotiate the debt with Venezuela at an interest rate three times higher than the rate established in the agreements signed in 2004.

In 2007-2008, Cammesa –Argentina's state wholesale power market administrator owned by the Ministry of Planning– failed to pay Pdvsa virtually all of the bills due in connection with the shipments of fuel oil and gasoil to feed Argentina's thermal plants. In March, and given the possibility that Pdvsa cut the shipments planned for this year, Cammesa's executives decided to negotiate a refinancing plan with the Venezuelan oil company.

After several meetings, the experts agreed to a "reconciliation balance sheet" which resulted in a USD 813.8 million debt by March 31, 2009.

The renegotiation scheme provides that Venezuela will charge a LIBOR rate plus a 6 percent annual margin rather than the 2 percent interest rate, which was initially charged in the original agreements, the Argentinean newspaper Clarín reported.

July 01

Pdvsa requests payment of debts related to energy deals
Amidst financial problems, the state-run oil company Petróleos de Venezuela is asking foreign companies to repay their debts under energy supply agreements.

Recently, the Venezuelan oil holding requested Argentina and Paraguay to meet their obligations.

Concerning Paraguay, the officials of Pdvsa decided not to negotiate and requested cash payments. According to ABC newspaper, the Paraguayan oil company Petropar asked for refinancing of the USD 302 million debt; however, Pdvsa officials rejected the proposal and requested the Paraguayan company to make a down payment of USD 180 million for due obligations.

Pdvsa will register the Petrobono 2011 in foreign markets
State-run oil company Petróleos de Venezuela (Pdvsa) announced on Wednesday, July 01 that the USD 3 billion bond issue dubbed "Petrobono 2011" will be registered in international markets, a move expected by investors willing to buy the instrument.

"Consequently, the oil company will give notice to the financial entities asking the required information for the respective registry in Euroclear and/or Clearstream," said the Venezuela oil-run company in an addendum to the notification issued last week to announce the operation, Reuters reported.

July 03

Pdvsa's contribution to Treasury down 76 percent in the first quarter
The behavior of oil prices in the first quarter of 2009 has worsened the fiscal gap that began to grow in 2008.

The Ministry of Economy and Finance issued the public sector's results for the first quarter of the year. They include data from the central government, the state-run oil company Petróleos de Venezuela (Pdvsa), the Bank Deposit Guarantee and Protection Fund (Fogade), Social Security, and non-financial state companies.

The figures show that in the first quarter of the year, the deficit of the public sector stood at USD 3.58 billion, which is equivalent to 0.9 percent of GDP. The financial results of Pdvsa had direct effects on the fiscal gap.

Meanwhile, the operating surplus of the oil industry amounted to USD 2.74 billion in the first quarter of the year. This means a 76 percent fall compared to the same period of 2008, when it amounted to USD 11.95 billion.