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Venezuela's Maduro drafts bill to expand powers for new oil deals

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10/01/2020 | 06:25pm EDT

CARACAS, Oct 1 (Reuters) - Venezuelan President Nicolas Maduro has drafted legislation to grant his government expanded powers to confidentially sign new oil deals with private firms and foreign nations as a way of getting around U.S. sanctions, according to the proposal and people familiar with the initiative.

Maduro delivered the "anti-blockade" bill on Tuesday to the government-aligned Constituent Assembly, a parallel legislature he created to bypass the opposition-controlled congress. The sources said the assembly will pass it into law during its next session.

The draft legislation, seen by Reuters, allows the government to modify the "constitution, ownership, management, and administration" of Venezuela's public and semi-public companies. With the reform, Maduro is seeking greater investment in the oil sector, the sources said, speaking anonymously because they had not been authorized to speak publicly.

All the agreements will initially be secret as the proposal establishes a "temporary regime of classifying documents."

"It will allow us to use new mechanisms, which we have to do in silence, to promote foreign investments," oil minister Tareck El Aissami said on state television.

By giving more control of oil production to private companies, his government could dodge sanctions focused on PDVSA, the sources said. The document does not specify what stake Venezuelan state-run oil firm PDVSA will maintain in its partnerships.

Years of mismanagement and corruption, along with crippling sanctions imposed by the Trump administration, have caused the OPEC nation's oil sector to collapse.

The new bill also opens the door for Maduro to reverse the nationalization of many Venezuelans firms under the socialist government of his predecessor Hugo Chavez.

"If nationalization did not generate benefits, we need to look for ways to avoid having a graveyard of infrastructure," Hermann Escarrá, an influential member of the Constituent Assembly close to Maduro, said in an interview. (Writing by Angus Berwick; Editing by Steve Orlofsky and David Gregorio)


Stocks mentioned in the article
ChangeLast1st jan.
LONDON BRENT OIL -3.74% 39.07 Delayed Quote.-38.33%
WTI -3.98% 37.35 Delayed Quote.-36.69%
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